Tech View: Nifty stiff resistance around 23,000-100. What traders should do on Tuesday

“Thus, we shall expect more consolidation before the next leg of an uptrend resumes. Also, after a sharp run-up, the probability of a sideways consolidation is high and hence the Nifty can consolidate around 23,000 till the monthly expiry,” said Jatin Gedia of Sharekhan.

An analysis of Nifty put options reveals a concentration of Open Interest (OI) at the 22,700 level, implying potential support at this level. On the call side, significant OI concentrations are observed at the 23,200 and 23,500 levels.

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

Osho Krishan, Angel One

From a technical standpoint, the benchmark has reverted from the upper band of the ‘Rising Channel’, suggesting a potent resilience for Nifty in the near term. Also, the advance-decline ratio favoring the bears portrays the exhaustion among the bulls. At the current juncture, the upper band of the channel placed around 23,150-23,200 is likely to be seen as an intermediate hurdle. On the other hand, the neckline of the breakout around 22,800-22,750 is expected to provide a cushion to the benchmark. For now, the index is likely to hover within the aforementioned range with bullish biases, and one needs to act accordingly and use proper risk management.

Tejas Shah, Technical Research, JM Financial & BlinkX

Nifty is facing stiff resistance around 23,000-100 levels on an immediate basis and there is a strong possibility of minor profit booking from this psychological resistance in the next couple of days since some of the technical indicators like RSI and Stochastics are in overbought territory on the short term charts that could lead to knee-jerk reactions from time to time. The broader set-up continues to be bullish and hence, post some consolidation/correction, we should see more upside. Support for Nifty is now seen at 22,750-800 and 22,500 levels. On the higher side, the psychological resistance is at 23,000 and the next resistance zone is at 23,150-200 levels. Overall, bulls should continue to have an upper hand going forward.

Rupak De, LKP Securities

Nifty remained mostly volatile during the day as India awaits the final phase of the general election. The near-term outlook remains positive, with the index staying above the crucial moving averages. Support lies at 22,900, below which the index might slip towards 22,800. On the higher end, bears are active around 23,000-23,050. A decisive move above 23,050 might trigger a stronger rally towards higher levels.(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)