Ravi Nathani suggests buying on dips for Nifty, cautious on Midcap Select

Nifty50 index is exhibiting a bullish trend in the near term, supported by positive signals from technical indicators, while, Nifty Midcap Select index is trending bullish on charts

Nifty50 index: Bullish momentum with key levels to watch

The Nifty50 index is exhibiting a bullish trend in the near term, supported by positive signals from technical indicators like the RSI and MACD, both of which are pointing towards upward momentum. The index faces stiff resistance at 24,925–25,150, with a breakout above 25,150 likely to push it towards higher resistance levels at 25,500–25,600. 

 

This makes 25,150 a crucial level to monitor for the continuation of the bullish trend. On the downside, support levels are seen at 24,450–24,275 and 24,200. A breach below 24,200 on a closing basis would invalidate the bullish outlook, potentially driving the index lower to 23,800. As such, 24,200 serves as a critical level for traders maintaining bullish positions.

 

 

Given the current market structure, the best trading strategy is to buy on dips, leveraging the support levels to enter long positions while keeping a close eye on the 25,150 resistance for potential upside momentum. Traders are advised to maintain a strict stop loss at 24,200 to manage risks effectively. 

 

In summary, the Nifty50 index is poised for further gains in the near term, with bullish momentum supported by technical indicators. While the outlook remains positive, adherence to key levels and disciplined trading strategies will be essential to capitalise on opportunities and mitigate risks.

 

Nifty Midcap Select index: Bullish momentum with key resistance ahead

The Nifty Midcap Select index is trending bullish on charts, but it faces a crucial resistance range between 13,125–13,250. This zone is expected to act as a significant barrier, with a weekly close above 13,250 potentially triggering a fresh bullish breakout. In such a scenario, the index could target higher resistance levels at 13,750 and 14,250, making 13,250 a critical level to monitor. 

 

This resistance can be considered the "last hope" for bears, as a breakout would signify a strong upward momentum. On the downside, a gap persists at 12,225, which raises concerns about accumulating positions at the current market price. This gap suggests that the index might witness a pullback before resuming its upward trajectory. Key support levels are located at 12,650–12,500 and 12,225, providing opportunities for traders to enter long positions near these levels. 

 

The best trading strategy under the current circumstances would be to buy near the support levels to mitigate the risks associated with the gap at 12,225. Traders should also closely monitor the 13,250 resistance level, as a breakout could lead to significant bullish momentum. 

 

In conclusion, while the Nifty Midcap Select index exhibits bullish characteristics, traders are advised to approach cautiously, focusing on support levels for entries and keeping a close eye on the resistance at 13,250 for confirmation of a sustained upward move.  (Ravi Nathani is an independent technical analyst. Views expressed are personal.)