Nifty50 outlook: Await breakout above 22,464 to initiate bullish positions

Investors are encouraged to focus on profit booking opportunities, considering potential re-entry points at the specified support levels, says Ravi Nathani

Nifty 50 Index Outlook

The Nifty Index, which last closed at 22,378, has exhibited a bullish trend on charts, marking a breakout on the first day of the month.

The technical landscape highlights crucial levels that investors and traders need to monitor for strategic decision-making. The immediate focus is on the strong resistance level at 22464. A closing above this level is deemed essential to sustain the bullish momentum.

If achieved, the subsequent resistance levels are identified at 22750 and 23225. These levels serve as critical benchmarks for assessing the strength of the upward movement.

Conversely, a close below 21980 is regarded as a pivotal point, signaling a potential shift in the bullish trend. In the absence of such a breakdown, the outlook remains optimistic.

Noteworthy support levels for the month are identified at 21800, 21680, 21510, and 21225. These levels act as robust support zones that investors should closely monitor.

Technical indicators portray an overbought condition on charts. This suggests that the recent uptrend may attract profit booking from swing traders.

Consequently, the recommended trading strategy for the month involves investors looking to capitalize on profit booking opportunities and identifying potential entry points around the mentioned support levels.

For traders, the optimal strategy is to build bullish positions if the index closes above 22464. The target levels for this strategy are set at 22750 and 23225.

To manage risks effectively, traders are advised to set stop-loss at 22200 or 21980, depending on individual risk appetites, on a closing basis.

In summary, the Nifty Index has established a bullish trend, and key resistance and support levels have been identified for strategic decision-making.

Investors are encouraged to focus on profit booking opportunities, considering potential re-entry points at the specified support levels.

Traders should await a confirmed breakout above 22464 to initiate bullish positions, with predefined stop-loss levels to mitigate risks.

This comprehensive approach aligns with the current technical outlook and provides a roadmap for navigating the market in the coming month.

Disclaimer: Ravi Nathani is an independent technical analyst. He does not hold any positions in the Indices mentioned above and this is not an offer or solicitation for the purchase or sale of any security. It should not be construed as a recommendation to purchase or sell such securities.