Technical View | Nifty forms bullish candle, next hurdle 18,500

The Nifty gained strength in the last hour of trade in a volatile session on November 15 and closed above 18,400 for the first time in 13 months on positive Asian cues and gains in banking & financial services, auto, and metal stocks.

After opening higher at 18,363, the index lost momentum to slip to the day’s low of 18,282 in the morning trade but last-hour buying pushed it to the day’s high of 18,428. The Nifty ended the day at 18,403, up 74 points.

It formed a bullish candlestick on the daily charts, indicating that the positive trend will continue in the short term.

If the index sustains above 18,400 in the coming sessions, the next key level to watch out for would be 18,500, with immediate support at 18,300 followed by 18,000, experts said.

“The headline index Nifty remained volatile during the session. On the lower end, 18,300 acted as support on a sustained basis, whereas on the higher end, the index moved above 18,400,” Rupak De, Senior Technical Analyst at LKP Securities said.

The trend remains positive for the short term, as the index closed above the 50-day exponential moving average (EMA). On the higher end, resistance is placed at 18,500-18,600. Support on the lower end is pegged at 18,250-18,300 zone, the market expert said.

On the options front, the maximum Call open interest was at 19,000 strike, which is expected be crucial resistance for the Nifty, followed by 18,500 strike with Call writing at 18,400 strike then 18,700 strike.

The maximum Put open interest was seen at 18,000 strike, the crucial support, followed by 17,500 strike, with Put writing at 18,300 strike then 18,400 strike.

The data indicates that the Nifty’s immediate trading would be 18,200-18,600.

India VIX, which indicates expected volatility over the next 30 days, was down 1.84 percent at 14.64 levels.

Banking index

The Bank Nifty opened positive at 42,234 and after some weakness in the first half, the index touched a new high of 42,450.

It ended the day at 42,373, its best close, gaining 296 points from the previous session. It formed a bullish candle on the daily frame. Now, it has to hold above 42,250 to make a move towards 42,750 and 43,000. Supports are at 42,000 and 41,750, Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services said.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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