Nifty 50 ended higher on Monday but formed a Doji-like candle after trading within its second-smallest daily range of 2026, signalling indecision near a key resistance zone.
The benchmark index opened more than 90 points higher and climbed to an intraday high of 24,168.05, close to its June 18 peak. However, it failed to sustain gains and gradually lost momentum through the session. Nifty settled at 24,102.90, up 89.80 points, or 0.37%.
The narrow trading range and Doji formation suggest that market participants remain cautious despite the index closing above a downward-sloping channel. The high and low of Monday's session are likely to serve as the key reference points for Tuesday's trade.
Doji Formation Puts Focus On Key Levels
Nifty traded within a range of just 95 points during the session, making it the second-narrowest daily range recorded by the index so far this year.
Although the benchmark finished slightly above the declining channel, it struggled to build on early gains. After the first hour of trading, the index continued to make lower highs, indicating resistance around higher levels.
The high and low of Monday's Doji-like candle are expected to act as immediate resistance and support levels in the near term.
Support And Resistance To Watch
A sustained move below Monday's low of 24,073 could strengthen the negative implication of the Doji pattern.
If that level is breached and the index closes below it, Nifty may move towards the gap zone created on June 15 between 23,645 and 23,818.
On the upside, a sustained move above the 24,168-24,200 zone could pave the way for a rise towards 24,482, the swing high recorded on May 7. The next resistance level is seen at 24,602, the swing high of April 21.
Derivatives Data Signals Short Covering
Derivatives data indicate fresh short covering in the market, with open interest declining while the index ended the session in positive territory.
For Tuesday's session, traders are likely to closely monitor Monday's high and low, which remain the most important near-term levels for the benchmark index.
Stock To Watch: Zydus Wellness
Zydus Wellness Breaks Above Trendline Resistance
Zydus Wellness has broken above a falling trendline that had capped gains for more than two months, with the move backed by a sharp increase in trading volumes.
The stock recorded traded volumes of 13.63 lakh shares on the NSE, nearly four times its 10-day average, indicating increased participation following the breakout.
The stock is trading above its 20-day, 50-day, 100-day and 200-day moving averages, pointing to strength across multiple time frames.
Momentum Indicators Remain Supportive
The daily MACD remains in an uptrend and has rebounded after finding support near its nine-period average.
The 14-day relative strength index has also moved above the 60 mark, indicating improving momentum.
As long as the stock remains above Rs 538, the near-term bias is expected to stay positive. On the upside, the stock could move towards the Rs 575-Rs 600 range over the medium term. A stop-loss level can be placed at Rs 518.
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