Nifty eyes breakout as bulls challenge key 24,600 resistance: Angel One

Disclaimer: This article is written by Hitesh Rathi, technical analyst -equity & derivatives, Angel One. Views expressed are his own. Readers' discretion is advised.

 

Nifty extended its winning streak to a fifth consecutive session, as buyers successfully recouped all the losses from the previous week. The week began on a buoyant note, with the index opening on a notable gap-up.

 

Thereafter, buyers maintained firm control, steadily pushing prices, albeit at a measured pace. By the end of the week, the index had climbed to its highest level in the past seven weeks, reflecting sustained buying interest and improving market sentiment. 

 

 

Buyers managed to secure a strong weekly close at 24,383, with the index ending the week higher by 2.59 per cent. Despite the strong recovery witnessed during the week, the broader technical structure remains confined within the prevailing trading range on the weekly charts, with immediate resistance placed in the 24,500–24,600 zone and key support around the 23,800 mark. 

 

The sharp rejection of the lows registered in the previous week, followed by a gradual recovery, highlights strong demand at lower levels and renewed buying interest. Further reinforcing this constructive undertone is the formation of a bullish bear-trap pattern on the Daily 0.25 per cent x 3 Point & Figure chart, followed by a weak bearish three-column triangle, suggesting that buyers continue to defend lower levels despite intermittent bouts of selling pressure.   CHECK Stock Market LIVE Updates

 

That said, the higher time-frame charts continue to indicate a broader sideways consolidation. While a decisive breakout above the 24,550–24,600 resistance band would strengthen the near-term bullish bias, only a sustained move above the 24,650–24,700 zone would confirm a meaningful trend reversal. 

 

Such a breakout would invalidate several prevailing bearish chart structures, decisively shifting the balance in favour of the bulls and paving the way for a sustained upmove. At this juncture, a wait-and-watch approach appears prudent, given the index's proximity to key overhead resistance levels. 

 

A decisive breakout above the resistance zones should be closely monitored before adopting an aggressive bullish stance. Immediate support for the index is likely to be found in the 24,250-24,200 band, followed by a stronger cushion in the 23,980-23,950 band.

 

Participants should closely monitor the key breakout levels on the index and look to increase exposure only upon a decisive breakout. Until then, as advocated earlier, adopting a stock-specific approach remains the preferred strategy, focusing on fundamentally and technically strong stocks that offer buying opportunities on retracements towards key support levels or their short-term moving averages.