Nifty Midcap 50 in 'Sell on Rise' mode, says Ravi Nathani

The short-term bias for Nifty Midcap 50 index is likely to remain negative as long as the index remains below 8,786.

Nifty Realty Index

Bias: Range Bound

Last close: 393.75

The Nifty Realty Index has been observed on daily technical charts, which reveal important price levels and trends in the market. The current market price (CMP) of the index is 393.75, and it has been trading in a narrow range between 389 to 402.

The upper limit of this range is also known as the resistance level, while the lower limit is known as the support level. It is important to note that the index has been unable to break through the resistance level despite multiple attempts, indicating that there is significant selling pressure in the market at this level.

In technical analysis, a breakout occurs when the price of an asset breaks through a significant resistance or support level, indicating a potential change in trend.

In the case of the Nifty Realty Index, a bullish breakout is expected if it closes above the resistance level of 402. If this occurs, the index could reach an expected target range of 412-426.

Conversely, a bearish trend could be expected if the index closes below the support level of 389. In this scenario, the next support levels can be expected to be around 378-373.

Trading Strategy: Based on the technical analysis, traders are advised to adopt a "buy low, sell high" approach to capitalize on the expected price movements. This means buying near the support level and selling near the resistance level. Traders should be cautious and avoid taking positions until a clear breakout in either direction is observed. Once a breakout is observed, traders can take positions in the direction of the breakout.

Nifty Midcap 50 Index

Bias: Sell on the rise

Last close: 8,451.70

The Nifty Midcap 50 Index is currently trading at a current market price (CMP) of 8,451.70. Based on the technical analysis of daily charts, it can be observed that the index is range-bound between 8,551 to 8,310.

A bullish trend is expected if the index trades and closes above 8,551, with the next resistance levels at 8,610-8,680-8,740. Conversely, a bearish trend is expected if the index trades and closes below 8,310, with the next support levels at 8,225-8,065.

The short-term trend is down unless the index closes above 8,786. Therefore the best trading strategy in short term would be to hunt for opportunities to sell on a rise with a strict stop-loss of 8,786 on a closing basis, whereas near-term traders must monitor the range (8,551-8,310) and follow the trend after a violation in any direction.

(Ravi Nathani is an independent technical analyst. Views expressed are personal).