The benchmark Nifty 50 remains at a cautious juncture but buy on dips and sell on rallies would be the ideal strategy for day traders, according to analysts. On the charts, the index signals buying demand at lower levels from the extreme oversold territory after 900 points decline in just five sessions.
From a technical standpoint, the 50-Double Exponential Moving Average at 25,900 is expected to serve as an intermediate hurdle, followed by a strong resistance level at the 26,000 mark, which coincides with the 20-DEMA, Osho Krishan, chief manager of technical and derivative research at Angel One, said.
A decisive breakthrough above these levels could only reignite bullish sentiment in the upcoming session.
On the downside, 25,650 and 25,600 would act as key support zones, while 25,900-25,950 could serve as immediate resistance areas for the bulls, said Shrikant Chouhan, head of equity research at Kotak Securities.
Tuesday will be the weekly expiry for the Nifty futures contract.
Nifty Bank
Analysts expect the Nifty Bank index to extend the consolidation within the 58,700–60,000 range.
The key short-term support zone lies at 59,000–58,700 which represents a confluence of the 50-day exponential moving average and the previous month’s low, making it a crucial level to watch, according to Bajaj Broking.
Market Recap
Indian equity markets closed higher on Monday, after a rebound from intraday lows driven by improved investor confidence following favorable comments from the new US Ambassador on a potential trade deal ahead of upcoming negotiations.
The BSE Sensex gained 301.93 points, or 0.36%, to settle at 83,878.17, while the Nifty 50 advanced 106.95 points, or 0.42%, to 25,790.25.
In the broader market, midcap stocks ended flat, while the small-cap index slipped 0.5%.
Foreign Portfolio Investors continued their pullout from Indian equities for the sixth consecutive session, selling a net Rs 3,638.4 crore, as per provisional data from the National Stock Exchange.
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