Tech View: Nifty forms long bull candle, may test 24,580-24,640. Here’s how to trade on Wednesday

Nifty on Tuesday ended 113 points higher to form a long bull candle on the daily chart and also hit a fresh record high intraday.

The underlying trend of Nifty continues to be positive. Having moved above the key overhead resistance of 24,400 levels (1.618% Fibonacci extension), the Nifty could now advance towards another important resistance of 24,960 levels (1.786% Fibonacci extension) in the near term. Immediate support is at 24,250 levels, said Nagaraj Shetti of HDFC Securities.

Open Interest (OI) data showed that on the call side, the highest OI was observed at 24,800 and 25,000 strike prices. On the put side, the highest OI was at 24,000 strike price.

What should traders do? Here’s what analysts said:

Om Mehra, Technical Analyst, SAMCO Securities

The index is well-supported by the 10-day moving average of around 24,200. Trading within a broad rising channel, marked by higher highs and higher lows, which displays a strong primary trend. The index swiftly recovered despite a 23.6% retracement and moved higher. Nifty is expected to test the range of 24,580–24,640 in the upcoming session.

Rupak De, Senior Technical Analyst, LKP Securities

Nifty remained strong throughout the day, holding the support level of 24,300. The sentiment is likely to remain positive as long as it stays above 24,300, where significant put writing has occurred. On the higher end, the 24,500-24,600 range might act as an immediate resistance zone. Overall, the sentiment may continue to favor the bulls in the near term unless the index falls below 24,300.

Jatin Gedia, Sharekhan

On the daily charts, we can observe that the Nifty closed above 24,400 suggesting that there is likely to be more upside over the next few trading sessions. The next target of the upside is 24,610, which is the 161.82% fibonacci retracement level of the previous fall and also the daily upper Bollinger band.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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