Tech View: Nifty sustains above 21-EMA. Here are the hints for Wednesday’s trade

Indian headline indices rose for the third straight session on Tuesday, led by heavyweights HDFC Bank and Reliance Industries (RIL), the top contributors to the index. While the S&P BSE Sensex rose 598 points or 0.74% to settle at 80,845.75, the broader Nifty50 gained 181.10 points or 0.75% to close at 24,457.15.

Indian equity markets started the day on a firm note and continued their upward trend throughout the session, Osho Krishnan, Senior Analyst (Technical & Derivatives) at Angel One said that he could see the market breadth clearly turning to a bullish trend, an overall sign. gives Positive sentiment among investors.

“On the technical front, the benchmark index has developed above the 50 DEMA after a long gap and is now placed above all its significant EMAs on the daily chart structure, indicating a strong bullish trend. Further, the Nifty index is now moving towards a critical blockade at 24,500 as it gradually moves higher, which is likely to be seen as a make-or-break zone for market sentiment. A decisive advance at this point could signal a trend reversal, potentially leading to a continuation of the primary bullish trend and a move towards 24,800,” Krishnan said.

What should traders do? Here’s what analysts had to say:

Jatin Trivedi, LKP Securities

The Nifty witnessed another bullish day as the index moved above the 38.20% Fibonacci retracement level of the previous decline from 26,277 to 23,263. Furthermore, the index has broken out of the recent consolidation phase on the daily chart, indicating an increase in bullish sentiment. Further, the Nifty is holding above the crucial 21-day exponential moving average (21EMA), reinforcing optimism. As long as the index sustains above 24,400, sentiment is likely to remain in favor of bulls, with the possibility of testing 24,600-24,700 levels. On the downside, a break below 24,400 could trigger a correction towards 24,150.

Jatin Gedia, Meera Asset Sherkhan

The Nifty opened a gap up and traded with a positive bias to close with a gain of 181 points during the day. On the daily chart, we can observe that the Nifty has closed above the critical resistance zone of 24,320 – 24,350, which is a bullish signal. We expect positive momentum to continue towards 24,770. 23,900 – 23,870 is a critical support zone on the downside.

Hrishikesh Yedve, Asit C. Mehta Investment Intermediates

The Nifty opened on a positive note, but after initial volatility, the index resumed bullish momentum and ended the day on a positive note around the 24,457 level. Volatility index India VIX fell 2.22% to 14.37, indicating a reduction in market volatility.

Technically, on the daily chart, the Nifty has seen a breakout of an inverted head and shoulder pattern, indicating strength. Further, the index crossed both the 100-day exponential moving average (DEMA) hurdle (24,310) as well as the 50-DEMA hurdle (24,370) and closed above them, indicating strength. On the upside, 24,550 will act as immediate resistance for the index. If the index sustains above 24,550, the upside move may extend towards 24,700-24,800 levels. As long as the Nifty remains above 24,300, traders should adopt a buy-on-dips strategy.

(Disclaimer: Recommendations, suggestions, opinions and views given by experts are their own. These do not represent the views of Economic Times)