Bias for Nifty IT index to turn bullish only above 32,664, indicates chart

Nifty IT Index Bias Bullish with a condition.

The Nifty IT Index, currently at 32,608.40, exhibits an upward trend in the near term. The index has closed very close to its immediate resistance level of 32,664. A close above this level is anticipated to trigger short covering in the near term. Following such a breakout, the next resistance levels on the charts are expected at 32,980 and 33,725.

The recommended trading strategy aligns with this scenario. Traders are advised to consider buying positions only above the 32,664 level on a closing basis. Until this breakout occurs, it is advisable to exercise patience and refrain from adding fresh positions. 

Short selling or booking profits is not advised at the moment, given the prevailing upward trend evident in the short-term chart patterns. 

In essence, the Nifty IT Index presents a potential buying opportunity contingent upon a confirmed breakout above the 32,664 resistance level. Traders are encouraged to monitor the charts closely and act in accordance with the identified strategy, optimizing their positions based on the evolving market dynamics.

Nifty Auto Index Bullish Bias on Charts, Keys levels to watch for near & short term

The Nifty Auto Index, currently at 17,482.45, is exhibiting an upward trend on charts as it has closed once again at a lifetime high, marking an uncharted territory.

In such scenarios, it is advisable to use the weekly lowest point as a strict stop loss for all bullish positions. For this index, the last week's low is at 16,730. A close below this level would be the first sign of bearishness on the charts, indicating a potential shift in the trend.

It's crucial to note that the concept of stop loss varies for different trading horizons. For short-term traders, the weekly low (16,730) serves as the reference point, while for near-term traders, it is the last three trading sessions' low (16,307). Closing below these levels would be the initial indication of a bearish trend.

As the index has closed at its all-time highest point, an uncharted territory, short selling or booking profits is not advised unless these stop loss levels are broken or violated on a closing basis. Until then, the trend is considered bullish and is expected to outperform, emphasizing the importance of monitoring these key levels for strategic decision-making.

(Ravi Nathani is an independent technical analyst. Views expressed are personal).