Trade Setup For Nov 7: Nifty Support Slips To 25,500—25,300 As Analysts See Further Weakness

The Indian stock market ended weak for a second session straight on Thursday. Analysts see further weakness in the charts as the benchmark has fallen below the critical 21EMA on the daily timeframe, indicating weakness, as per Rupak De, Senior Technical Analyst at LKP Securities.

"The index formed a bearish candlestick pattern with a lower high and lower low for the fifth session in a row highlighting extended profit booking", said Bajaj Broking Research.

The research firm added that the index seems to be approaching a crucial demand zone between 25,500 and 25,300, which is expected to act as a strong support base. 

"A decisive formation of a higher high and higher low will signal a pause in the current decline and open pullback towards immediate resistance of 25,850", it further stated. If this happens, the next key resistance will be placed at 26,100 levels.

Shrikant Chouhan, Head Equity Research, Kotak Securities reiterated weakness in the charts and said that current market texture is weak, but a fresh sell-off is possible only after the dismissal of 25,450/83,100.

Whereas Rajesh Bhosale, Equity Technical Analyst, Angel One advised investors to refrain from aggressive bets on either side of the market and to allow for stabilization to gain a clearer understanding of the situation.

"During this period, it is essential to stay informed about domestic and global developments that may affect our markets", he remarked.

Bank Nifty will extend its consolidation phase as the charts have, "formed a bear candle with a lower high and a lower low signaling consolidation amid stock specific action," as per Bajaj Broking Research.

"A close below 57,300 will open downside towards the key support area of 56,800–56,500. On the higher key resistance is placed at recent all time high of 58,577," the research firm highlighted.

Indian equity market closed lower for a second straight session with the Nifty ending 0.34% lower at 25,509.70 and the Sensex ending 0.18% lower at 83,311.01.