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Resistance for Nifty seen at 18,900; Bias remains bullish

According to Ravi Nathani, an independent technical analyst, the Bank Nifty, however, remains trapped in the 44,500 - 43,375 range for now.

Illustration: Ajay Mohanty
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Illustration: Ajay Mohanty

Ravi Nathani Mumbai

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Nifty 50 Index

The Nifty 50 Index is currently trading at a CMP of 18,826.00. It has recently reached its all-time highest close, indicating a strong bullish trend on the charts. As long as the index maintains a close above the key support level of 18,500, the bullish trend is expected to persist. A close below this level may signal a potential shift in the trend.

On the upside, resistance levels are anticipated around 18,900 and 19,400. These levels could act as significant barriers or targets for the index as it continues its upward momentum.

Given the current market conditions, the recommended trading strategy would be to buy on dips, particularly near the support levels of 18,650 - 18,500. This strategy entails seeking opportunities to enter the market during temporary pullbacks or corrections within the overall uptrend.

Buying on dips enables traders to take advantage of favorable risk-reward ratios at potential entry points. It is important to closely monitor the market and adapt strategies based on any changes in the trend, price action, or market conditions.

Nifty Bank Index

The current state of the Nifty Bank Index can be described as range-bound trading, where the index is moving within a specific price range. The upper limit of this range is at 44,500, while the lower limit is at 43,375. The direction of the market will be determined by a close above or below this range.

If the index closes below the lower limit, which is at 43,000, it would indicate a shift towards a bearish trend. This would suggest that sellers have gained control and could lead to further downside movement. In such a scenario, the index is likely to find support at around 42,500 and 41,900.

For traders who have taken bullish positions, it is crucial to manage risk effectively. It is advisable to set strict stop-loss orders at either 43,375 or 43,000, depending on individual risk appetite. This ensures that losses are limited if the market moves against their positions.

On the other hand, if the index manages to close above the upper limit of 44,500, it would signal strength in the bullish trend and could open doors for new record highs. In this case, resistance levels to watch for would be around 45,000 and 45,500.

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

 

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First Published: Jun 19 2023 | 7:06 AM IST

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