- Nifty 50 slipped below the key support level of 26,000 after three straight declines
- Markets expected to consolidate with profit booking at higher levels, says analyst
- Immediate Nifty resistance is at 26,200, with a breakout target of 26,260-26,300
The crucial support level for Nifty 50 slipped below the psychological-mark of 26,000, analysts said after the benchmark index declined for a third consecutive day on Wednesday.
"Overall, we expect markets to remain in a consolidation phase with profit booking emerging at higher levels; while sector-specific movements continue, driven by third quarter business update announcements," said Siddhartha Khemka head of research, wealth management, Motilal Oswal Financial Services Ltd.
The index faces key support around 26,000-25,900 levels, according to Bajaj Broking Research. This zone is the "confluence of the 50-day extended moving average and the rising demand line joining the last four months lows", it added.
On the higher side, 26,200 would act as an immediate breakout zone for the bulls, according to Shrikant Chouhan, head of equity research, Kotak Securities.
"A successful breakout of 26,200 could push the market towards 26,260-26,300," Chouhan said.
"On the flip side, below 26,070, selling pressure is likely to accelerate. If it falls below this level, the market could slip to 25,950-25,900," he added.
The index has formed a doji candle with a lower high and a lower low, signalling extension of the consolidation with corrective bias for the third session in a row after last week's strong upmove, according to Bajaj Broking Research.
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The Bank Nifty index finds immediate support at 59,500 levels and is expected to consolidate in the range of 59,500-60,400, thus forming a higher base for the next leg of upmove, according to Bajaj Broking Research.
"On the downside, immediate support is placed at 59,500 levels while key short-term support is placed at 59,000-58800 levels. Sustaining above the same will keep the overall bias positive," the brokerage said. It expects the index to gradually head higher towards 61,400 levels from a short-term perspective being the measuring implication of the recent range.
Notably, Nifty ended 37.95 points or 0.14% lower at 26,140.75 on Wednesday, whereas the Sensex settled 102.20 points or 0.12% down at 84,961.14.
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