Nifty Breaks Crucial Support at 22,000 After Bearish Engulfing Candle; Immediate Support at 21,850 with 20-EMA, Followed by 21,750.
Indian Indices Trade Lower Following Flat Opening on February 22; Bearish Engulfing Pattern Detected on Nifty Daily Charts. The benchmark Indian indices began the day with a flat opening on February 22 but soon turned red. Notably, the Nifty formed a bearish engulfing pattern on the daily charts after failing to sustain the levels achieved the previous day, particularly around the all-time high.
Experts anticipate that the indices may find support in the 22,000-22,030 zone. However, a correction could be imminent if the index dips below 21,980, with potential downside targets extending to the 21,890-21,830 zone.
Options Activity Indicates Expected Trading Range Between 21,900 and 22,300. Meaningful call writing was observed in the 22,100-22,200 strikes, indicating potential resistance levels for the market. Conversely, put writing occurred in the 22,000-21,900 strikes, suggesting support levels. Based on this options activity, the anticipated trading range for the upcoming sessions could be between 21,900 on the downside and 22,300 on the upside.
“Analysis from Sudeep Shah at SBI Securities Suggests Trading Range of 21,900 to 22,300” Sudeep Shah, DVP and head of technical and derivative research at SBI Securities, highlighted significant call writing in the 22,100-22,200 strikes and put writing in the 22,000-21,900 strikes. This implies a potential trading range for upcoming sessions between 21,900 on the downside and 22,300 on the upside.
Insights from Sheersham Gupta at Rupeezy on Market Sentiment and Nifty Support Levels Sheersham Gupta, director and senior technical analyst at Rupeezy, noted the negative market sentiment following the Fed officials’ cautious stance on rate cuts, resulting in Nifty breaking the crucial support of 22,000 after a bearish engulfing candle. However, Gupta believes that this bearish sentiment may not persist, suggesting that the sharp decline in Nifty is likely a knee-jerk reaction with limited downside potential. He identified immediate support for Nifty at 21,850, coinciding with its 20-EMA, followed by 21,750. Gupta also mentioned that for bullishness to return to the markets, Nifty will need to close above 22,000.
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