Nifty trading below all key short, medium-term averages
It’s 0.82% below 20DMA and 2.12% below 50DMA; Both are in a downtrend; To change the market condition to Rally Attempt after Friday’s recovery, it failed to get a follow-through day
image for illustrative purpose
The equity benchmark indices slipped again, led by metals and private banks. NSE Nifty closed at 17894.85, with 61.75 points or 0.34 per cent decline. The Nifty Metal and Media indices are down by 1.32 per cent and 1.36 per cent, respectively. The Nifty IT is the top gainer with 1.14 per cent. PSU Bank index is also up by 1.57 per cent. Energy, CPSE, and FMCG indices also closed in the green. All other indices ended with half a per cent decline at an average. The broader market was negative, as 1208 declines and 716 advances. Out of Nifty 50, 33 stocks closed with losses. About 44 stocks hit a new 52-week high and 89 stocks traded in the upper circuit. Reliance, HDFC Bank, and Adani Green were the top trading counters today.
The Nifty once again slipped below the 100DMA. It opened positively, but did not sustain at the higher levels even for 15 minutes. It made lower-high candles on the hourly chart. The 23.6 per cent retracement level of the prior downtrend acted as a resistance. It also faced resistance at 20DMA.
Currently, NSE Nifty is trading below all key short and medium-term averages. It is 0.82 per cent below the 20DMA and 2.12 per cent below the 50DMA. Both are in a downtrend. The 18027-52 zone is the resistance for now. Above this level, it can test 18191 and 18324. But sustaining below this zone means there is a higher probability of moving below 17774. For the last 15 sessions, this level holding as strong support. To change the market condition to Rally Attempt after Friday's recovery, it failed to get a follow-through day.
It is still in the downtrend and has no change in directional change. Three major banks, Axis bank, ICICI bank, HDFC Banks and Reliance, closed negatively led to the decline. An increased open interest shows fresh shorts built up in the system. For tomorrow it is better to wait for the first 15 minutes to get the directional bias. It may oscillate around 100DMA. Stay neutral.
(The author is Chief Mentor, Indus School of Technical Analysis, Financial Journalist, Technical Analyst, Trainer and Family Fund Manager)
