Trend bearish in Nifty FMCG; Metal close to resistance level: How to trade?

The Nifty Metal index is now positioned very close to its resistance levels, which are located at 8,110 and 8,250

Nifty FMCG Index

The Nifty FMCG Index, which last closed at 53,338, is experiencing a short-term downtrend on the charts. However, in the near term, there is potential for a technical bounce, although the overall trend remains bearish.

Resistance levels on the charts are anticipated around 53764 and 54050. For near-term traders looking to capitalize on a technical bounce with limited profits, buying at the current market price or on dips could be considered.

The targets for this trade would be 53,764, which is considered the safest level, and 54050, which carries a bit more risk.

Alternatively, traders may opt to wait for a small technical bounce and allow the index to achieve the aforementioned resistance levels before initiating short positions. In case of a downside move, support levels are expected around 52700 and 52100.

In summary, traders have the option to either buy for a technical bounce with limited profits or wait for a bounce to occur before building short positions. Support and resistance levels should be closely monitored to make informed trading decisions. 

Nifty Metal Index

The Nifty Metal Index, which last closed at 8,053, has recently rallied and is now positioned very close to its resistance levels, which are located at 8,110 and 8,250.

In light of this, the most prudent trading strategy would be to sell on any further upward movement, effectively capitalizing on the current resistance levels.

Traders may consider initiating short positions as the index approaches the resistance levels, aiming for a target price of 7,600 in the near term. For a potentially larger downside move, an additional target of 7,400 could also be considered.

By selling on rise and targeting these downside levels, traders can align their strategies with the current technical setup of the Nifty Metal Index. It's important to monitor price movements closely and execute trades based on confirmation of resistance holding and downside momentum building.

Disclaimer: Ravi Nathani is an independent technical analyst. He does not hold any positions in the Indices mentioned above and this is not an offer or solicitation for the purchase or sale of any security. It should not be construed as a recommendation to purchase or sell such securities.