Sell Nifty on rallies amid likely downtrend, stop-loss placed below 21,850

For Nifty, traders are advised to be cautious and consider selling on rallies or on a close below 21800, taking into account the indications from various technical indicators

Nifty 50 Index

The Nifty 50 Index, which last closed at 22,023, is indicating a downtrend in the near term as observed on charts.

A fresh trigger for panic selling, or in other words, a stop-loss level for all bullish positions, is placed below 21850.

This range of 50 points, from 21850 to 21800, is expected to act as a very strong support area for the index in the near term. Should the index close below this level on any given day, further downward movement could be anticipated, potentially leading to a decline towards levels around 21670, 21400, and 21150.

 

Conversely, a pullback could be witnessed if the index rises above 22125. In such a scenario, the next resistance levels are expected to be at 22200 and 22365.

However, my recommendation is to sell on rallies or on a close below 21800. This is supported by technical indicators such as short-term moving averages (both simple and exponential), MACD, RMI, and RSI, which are all trending downward.

Therefore, it is essential to remain watchful of these levels.

In summary, the Nifty Index is currently in a downtrend, with key support and resistance levels identified. Traders are advised to be cautious and consider selling on rallies or on a close below 21800, taking into account the indications from various technical indicators.

Nifty Mid Select Index

The Nifty Mid Select Index, which last closed at 10,486, is indicating a downtrend in the near term as observed on charts. The next support levels are expected around 10300, 10100, and 9775, which could be considered as the oversold zone for the near term.

On the flip side, resistance is anticipated around 10680 and 10880.

Technical indicators such as EMA's (Exponential Moving Averages) for both near and short term are trending downwards, indicating selling pressure that is likely to be witnessed on any rise in the index.

Therefore, the recommended trading strategy for this index is to sell on rallies or at the current market price, with a stop-loss set at the above mentioned resistance levels.

In summary, the Nifty Mid Select Index is currently in a downtrend, with support and resistance levels identified.

Traders are advised to sell on rallies or at the current market price, while being cautious of the resistance levels mentioned above, and considering the indications from technical indicators.

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.