Trade setup: Nifty evenly poised, must reclaim 100-DMA at 11,506

Falling for a fourth straight session, NSE Nifty on Wednesday struggled to keep its head above key supports and ended with a loss of 57 points or 0.49 per cent at 11,498.90.

The index closed just a notch below its 100-DMA at 11,506. It would be important for the 50-stock pack to crawl above this level to avoid further weakness. The opening on Thursday and the trajectory that the market forms will be crucial to watch out for.

Thursdays session will also see the weekly options expiry playing its part and contributing to the volatility. The session will see 11,560 and 11,595 levels act as resistance points while supports exist at 11,450 and 11,410.

The Relative Strength Index (RSI) on the daily chart stood at 36.5650 and has marked a fresh 14-period low, which is bearish. However, RSI did not show any divergence against the price.

The daily MACD stayed bearish and traded below its signal line. Apart from a black body, no vital formations were observed on the candles.

The pattern analysis of the daily charts showed that Nifty managed to cling on to the 100-DMA support on a closing basis. With the 100-DMA at 11,506, the index has closed just a few notches below this zone.

This area also coincides with another pattern support in the form of an extended trend line drawn from the 11,000 level.

Though the expiry of the weekly options is likely to infuse some volatility, the market has still not broken its crucial support area. Read More – Source

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