INSUBCONTINENT EXCLUSIVE:
Domestic stocks came under pressure on Thursday, forcing the equity benchmarks to consolidate in a narrow range
Nifty50 formed a small bearish candle on a daily chart as it signed off the day at 11,234, after hitting an intraday high and low of 11,293
and 11,208.
Expiry of weekly option contracts infused volatility in the market amid selling in financial shares.
During the process, Nifty
slipped below its 200-day moving average (DMA) at 11,268
The pause came after Wednesday’s splendid rally of over 1.50 per cent.
Milan Vaishnav, Consultant Technical Analyst at Gemstone Equity
Research - Advisory Services, said although the 11,200 level stood defended, it had maximum Put open interest (OI)
Thus, Nifty formed a lower top and higher bottom on the bar charts and ended one notch above its short-term 20-DMA at 11,222
Apart from a black body that occurred, no notable formations were observed on the candles.”
“We may see some consolidation in Nifty
going forward in a narrow range between 11,070 and 11,400
The overall strength will come if the index manages to breach the 11,400 level decisively,” said Rohit Singre, Senior Technical Analyst,
LKP Securities.
The market remained precariously poised not just for tomorrow but for the coming days, said analysts.
Vaishnav expects a
subdued start to Friday’s session and sees Nifty facing resistance at its 200-DMA at 11,268
“It would be extremely crucial for Nifty to move past this level and stay above it comfortably to avoid weakness
Any failure to do so will invite weakness in the market, which remains technically weak
The decline has come with the shedding of open interest and this reflects some long unwinding at higher levels,” he said.
Bank Nifty
closed the day at 28,013 with a loss of nearly 3 per cent, erasing all the gains of Wednesday’s session
Singre said the index has support near the 27,800-27,550 zone and faces resistance in the 28,300-28,500 zone.