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Nifty IT Index
Last close: 38,030
The Nifty IT Index, currently trading at a CMP (Current Market Price) of 38,029.70, is displaying a negative bias on the closing basis, signaling weakness on the charts. A crucial level to watch is if the index trades below 37,780, as it could trigger a fresh round of selling.
In the event of the index falling below 37,780, it suggests a bearish sentiment prevailing in the market, potentially leading to increased selling pressure. The next support levels to monitor are anticipated at 37,400 and 37,125.
Traders should pay close attention to these levels as they may act as crucial points for potential rebounds or extended downward movements. The negative bias on the closing basis indicates the presence of selling pressure in the IT index.
Traders may consider adjusting their strategies based on the observed price action and the breach or confirmation of the mentioned support levels.
In summary, the Nifty IT Index currently exhibits a negative bias, with a key level at 37,780. A breach of this level could attract fresh selling, with support expected at 37,400 and 37,125. Traders should closely monitor the index's behavior to make informed decisions in response to the prevailing market conditions.
Nifty Auto Index
Last close: 20,354
The Nifty Auto Index, currently at a CMP (Current Market Price) of 20354.25, has registered a negative close on the daily charts, signaling a sell-on-rise sentiment.
In light of this, traders are advised to consider a strategy of selling on upward movements. The identified support levels on the charts are expected around 20,050 and 19,725, and these levels are crucial for potential rebounds or extended downward movements.
The recommended trading approach aligns with the bearish bias for the near term, emphasizing the notion of selling on price rallies. The charts also indicate an overbought condition, signaling a potential pullback.
Traders should exercise caution and implement a strict stop-loss strategy, with a defined threshold at a close above 20,775.
In summary, the Nifty Auto Index's negative close on the daily charts prompts a sell-on-rise strategy, with support expected around 20,050 and 19,725. The overbought condition suggests a potential pullback, contributing to the bearish bias in the near term. Traders should be vigilant and manage risks effectively, incorporating the suggested stop-loss level in their trading strategy.
(Ravi Nathani is an independent technical analyst. Views expressed are personal).
