Nifty50 oversold on charts, may bounce in near term; check trading strategy

Nifty 50 Index: Anticipating a Technical Bounce

The Nifty 50 Index is currently oversold on the charts, with technical indicators such as RSI, MACD, and Stochastics all positioned in oversold zones. This suggests that a technical bounce could be expected in the near term. Resistance levels are anticipated at 23,400, 24,525, 24,636, and 24,750, while support is expected at 24,075 and 23,965.  Given the index’s current positioning, the best trading strategy would be to accumulate on dips, taking advantage of the oversold conditions to position for a bounce. It’s crucial to note that dips should not be seen as opportunities for fresh shorts but rather as chances to buy into the anticipated rebound.

 

Nifty Financial Services Index: Awaiting Breakout from Range

The Nifty Financial Services Index is likely to trade within a range in the near term, with key levels at 24,200 on the upper end and 23,600 on the lower. A trade and close above or below this range would serve as a trigger for directional movement. Should the index break below the lower level of 23,600, further support levels are projected at 23,480 and 23,400.  Conversely, if the index surpasses the upper level of 24,200, it could encounter resistance at 24,395 and 24,800. The optimal trading approach here is to wait for a confirmed breakout from this range before initiating trades, allowing traders to align with the index’s directional momentum.

 

In summary, the Nifty 50 Index appears ready for a technical bounce due to oversold indicators, making it a favorable buy on dips. Meanwhile, the Nifty Financial Services Index remains range-bound, with a breakout needed to determine its next directional move.  Both indices present opportunities for traders who follow closely and react to the levels specified, especially in this technically driven phase.  (Disclaimer: Ravi Nathani is an independent technical analyst. Views are his own. 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.)