The Nifty 50 regained the 24,000 level on Wednesday after opening higher and extending gains through the session, although it pared some of its advance near the upper boundary of a downward-sloping channel. The index ended the day up 0.59%, signalling an improvement in short-term price action while remaining within its broader trading range.
The move broke the recent sequence of lower highs and lower lows and lifted the index above its eight-day exponential moving average, indicating a short-term improvement. However, the broader market structure remains unchanged, with the Nifty continuing to trade inside an established range.
The index has stayed between 23,785 and 24,262 over the past 12 trading sessions while moving between its 50-day and 100-day moving averages. That pattern points to the absence of a sustained directional trend. On the weekly chart, the Nifty has formed long-legged candles with small real bodies over the past three weeks, reflecting continued indecision.
Nifty Forms Pro-Gap Pattern
Wednesday's trading resulted in a bullish-bodied candle with an upper shadow. The session also produced a higher high and a higher low compared with the previous day, ending the recent pattern of declining highs and lows.
The report said the candle resembles a "pro-gap" setup, which typically forms in the opposite direction of the preceding move. After Tuesday's decline, Wednesday's positive gap fits that pattern. The Nifty also climbed back above its eight-day exponential moving average, although the report noted that the broader range-bound structure remains intact.
Resistance Near 24,124 in Focus
The report identified the 24,050-24,124 zone as the immediate resistance area for Thursday. It said this region combines the upper boundary of the downward-sloping channel, Wednesday's high and the 100-day moving average.
According to the report, "A sustained move above this zone can take the index towards the upper end of the range at 24,262." It added that "a strong trending move is likely only after the index breaks out of the broader range on either side."
On the downside, the report placed immediate support at 23,900, followed by 23,784. It said a break below 23,784 could lead to the filling of the June 15 gap area.
Skipper Breakout Signals Fresh Buying Opportunity
The report also highlighted Skipper as a stock to watch after it broke above a downward-sloping trendline connecting the June 4 and June 17 highs. It said the breakout was backed by a bullish candle and higher trading volumes, indicating a possible resumption of the earlier uptrend.
The report noted that the stock had corrected by about 38.2% after rallying nearly 33% between May 18 and June 4. During the correction, it formed a higher low while the relative strength index made a lower low, creating a hidden bullish divergence that suggests the underlying trend remains positive.
According to the report, momentum indicators have improved, with the 14-period relative strength index moving above 60. It said the positive setup remains valid as long as Skipper stays above the Rs 560-562 zone, with upside targets of Rs 593 and Rs 614, while placing a stop loss at Rs 518.
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