Nifty50's sentiment remains bullish; buy the dips? Here's what analysts say

Nifty 50 Index

The Nifty 50 Index is currently trading within a well-defined range, with a resistance level at 24,400 and support at 23,880. A breakout above or below this range on a closing basis will likely trigger a significant move in the direction of the breakout.

Until such a breakout occurs, the most effective trading strategy is to buy near the support levels and book profits near the resistance levels. Given the overall bullish trend in the short term, it is not advisable to short-sell at resistance levels. Instead, traders should focus on buying on dips or near the identified support levels.

For this week, key support levels to watch for the Nifty 50 are at 24180, 24065, 24000, and 23880. On the upside, if the index closes above the 24400 level, the next resistance targets would be at 24680, 24880, and 25100.

The overall sentiment remains positive, and as the short-term trend is bullish, my recommendation is to adopt a "buy on dips" approach, capitalising on any pullbacks to accumulate positions for a move higher.

Nifty Midcap Select Index

The Nifty Midcap Select Index also exhibits a bullish trend in the near term. Traders should consider buying the index on dips, with a strict stop-loss at 12500 on a closing basis. This level serves as a critical support point, and as long as the index remains above it, the bullish outlook remains intact. The upside targets for the index are 12675 and 12800.

However, if the index breaks below the 12500 level on a closing basis, it would be prudent to expect the next support levels to emerge around 12425, 12380, and 12325. In this scenario, traders should adjust their strategies accordingly, potentially holding off on new buys until the index stabilizes near these lower support levels.

In summary, both the Nifty 50 and Nifty Midcap Select indices exhibit bullish trends in the near term. For the Nifty 50, the strategy is to buy near support levels, avoiding short-selling at resistance, with a focus on capitalizing on the overall bullish momentum.

The Nifty Midcap Select Index also favors a buy-on-dips strategy, with key levels identified for both upside targets and downside support. Maintaining a disciplined approach with stop-losses will be crucial for managing risk effectively in the current market conditions.

(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.)