ET Markets
12,186.80-61.45
Stock Analysis, IPO, Mutual Funds, Bonds & More

Trade setup: 12,000 mark stiff hurdle for Nifty, stay cautious

F&O data point towards very strong resistance at 12,000 level, followed by 12,100.

, ET CONTRIBUTORS|
Updated: Nov 06, 2019, 10.09 PM IST
0Comments
Getty Images
Stock3-Getty-1200
Expect the market to see a flat start on Thursday with 12,000 and 12,035 levels acting as strong resistance.
After taking a day’s breather, the bulls on Dalal Street came back roaring on Wednesday. NSE Nifty traded in a wide range, as the index hit a low of 11,911 and a high of 12,002.90 during the day. It finally settled with a gain of 48.85 points or 0.41 per cent at 11,966.05.

With no breakout yet on the higher time-frame charts, Nifty is placed at a crucial juncture. There is weekly options expiry on Thursday, and the maximum Call open interest continues to remain at 12,000 strike, which again acted as stiff resistance on Wednesday.

In terms of support, there is near similar Put OI builtup at 11,900 and 11,800 levels. Either of these levels are likely to get tactically shifted in Thursday’s trade.

We expect the market to see a flat start on Thursday with 12,000 and 12,035 levels acting as strong resistance. The supports may come in lower at 11,900 and 11,800. The trading range is expected to be wider-than-usual on Thursday.

The RSI on the daily chart stood at 71.07 and it has again crawled back above the 70 zone, in the overbought territory. The daily MACD stayed bullish and traded above its signal line.

1

A white body emerged on the candles, and apart from this, no other important formations were observed.

The pattern analysis continued to present a mixed set of pictures. Nifty is overbought on a couple of lead indicators while remaining away from its all-time highs. On the higher timeframe chart, a breakout is yet to be achieved.

The opening of the market and the behaviour against the 12,000 level will be critical to watch. If the index continues to stay below this level, it is more likely to delay its journey towards the lifetime highs. Any sustainable move above this zone will see the index marking fresh high.

However, the F&O data point towards very strong resistance at 12,000, followed by 12,100.

We recommend traders to chase upmoves with caution. A highly cautious view is advised for the day.

(Milan Vaishnav, CMT, MSTA, is a Consultant Technical Analyst and founder of Gemstone Equity Research & Advisory Services, Vadodara. He can be reached at milan.vaishnav@equityresearch.asia)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)

Also Read

Trade setup: Nifty needs to top 12,430 for sustainable breakout

Trade setup: Nifty needs to top 20-DMA at 12,200 to stabilise

Trade setup: Nifty vulnerable at higher levels; steer clear of technical pullback

Trade setup: Nifty may continue to consolidate; stay stock specific

Trade setup: Better stay light on positions; Nifty may consolidate

Comments
Add Your Comments
Commenting feature is disabled in your country/region.

Other useful Links


Copyright © 2020 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service