Nifty Trading Plan

The Nifty 50 continued its downward movement for the seventh consecutive session, falling below the 23,500 level on November 18. Most technical indicators suggest bearish sentiment, although the RSI (Relative Strength Index) has reached oversold levels. If the index sustains below 23,500, the further downside cannot be ruled out, potentially targeting the 23,300–23,200 zone. However, if it bounces back, resistance is expected in the 23,600–23,700 range. The Bank Nifty continued to outperform the Nifty 50, holding above the 200-day EMA (Exponential Moving Average) for the third consecutive day. As long as the index stays above the 200 DEMA (49,900), a move towards 51,000 remains possible. However, a drop below this level could lead to a decline towards 49,600, experts noted.

On Monday, November 18, the Nifty 50 fell by 79 points to close at 23,454, while the Bank Nifty gained 184 points, reaching 50,364. The market breadth was negative, with 1,563 shares declining and 941 shares advancing on the NSE.

Nifty Outlook and Strategy

Jay Thakkar, Vice President & Head of Derivatives and Quant Research at ICICI Securities

The Nifty has now closed below its 200 DMA, which is currently at the 23,564 level, making it an immediate resistance on the upside. A break above 23,564 could push the index towards 23,675. On the downside, 23,300 serves as immediate support, with further support in the range of 23,250. Therefore, the broader range is between 23,250 and 23,675, while the short-term range is 23,300 to 23,564. The momentum indicator MACD (Moving Average Convergence Divergence) is in sell mode on both the daily and weekly charts, indicating a continued downtrend.

On the derivatives front, the 23,500 strike has seen significant Call open interest build-up, with additions extending towards the 24,000 level. On the Put side, open interest is concentrated between 23,500 and 23,000, indicating support at each 100-point interval. As a result, the options open interest doesn't provide a clear directional bias. The Put-Call Ratio (PCR) is at 0.71, which is bearish. The maximum pain and modified maximum pain levels are at 23,500 and 23,452, respectively, and the index is currently trading near these levels. Based on these observations, there is no clear reversal signal from down to up. Therefore, until the index decisively breaks above 23,675, the short-term trend remains sideways to negative.

Key Resistance: 23,564, 23,675

Key Support: 23,000, 23,250

Strategy: Sell Nifty 50 at the current market price (23,454), with a stop-loss at 23,570, targeting 23,300 and 23,250.

Mehul Kothari, DVP – Technical Research at Anand Rathi

Technically, every pullback attempt has been swiftly countered by bears, causing the index to break through multiple critical support levels. The Nifty 50, along with the Nifty 500, Nifty Midcap 100, and Nifty Smallcap 100, has recently tested its 200 DEMA and closed near this level. This makes the upcoming sessions crucial for the bulls. If the Nifty fails to close above 23,500 in the coming week, it could lead to increased market anxiety. Meanwhile, the daily RSI has dipped into oversold territory, while the intraday RSI shows a positive divergence. On the upside, a move above 23,700 may trigger short-covering, offering much-needed relief. However, a decisive breach of 23,350 could push the index down towards the 23,200–23,000 zone.

Key Resistance: 23,700

Key Support: 23,350

Strategy: Buy Nifty Futures above 23,650, with a stop-loss at 23,400, targeting 24,100.

Pravesh Gour, Senior Technical Analyst at Swastika Investmart

The Nifty has reached its 200-DMA, with key support at 23,338. A bounce-back is expected from the 23,500–23,338 zone. On the upside, 23,800 serves as immediate resistance, with the next hurdle at 24,200.

Key Resistance: 23,800, 24,000

Key Support: 23,338, 23,000

Strategy: Consider selling on a rise near 23,800, with a stop-loss at 24,000, targeting 23,000.

Bank Nifty - Outlook and Positioning

Jay Thakkar, Vice President & Head of Derivatives and Quant Research at ICICI Securities

The Bank Nifty managed to close above the 50,000 level, which is a positive sign. However, the 51,000 level remains a strong resistance on the upside, so the short-term range is between 51,000 and 50,000 levels. The momentum indicator MACD is in sell mode on both the daily and weekly charts, indicating a downtrend in the short term. A fall below 50,000 could trigger another round of selling, as there is no significant support until the 49,000–48,500 levels.

On the derivatives front, the 50,000 and 49,500 strikes have the highest Put open interest on an immediate basis, while the 51,000 strike has the highest Call open interest. Technically and from a derivatives perspective, the Bank Nifty is trading within a range of 1,000 points. A break in either direction could lead to a new trend. The maximum pain and modified maximum pain levels are 50,500 and 50,347, respectively, and the index is currently trading near these levels.

Key Resistance: 51,000

Key Support: 50,000, 49,500

Strategy: Sell Bank Nifty below 50,000, with a stop-loss at 50,350, targeting 49,500 and 49,000.

Mehul Kothari, DVP – Technical Research at Anand Rathi

From a price action perspective, the Bank Nifty is showing signs of a breakdown, with a sustained move below 49,900 potentially raising concerns for banking stocks and the broader indices. On the upside, immediate resistance lies at 50,600, and a decisive move above this level could lead to some consolidation or a short-term pullback. The coming sessions will be crucial in determining whether the index stabilizes or continues its downtrend.

Key Resistance: 50,600, 51,000

Key Support: 50,000, 49,000

Strategy: No trade at this moment.

Pravesh Gour, Senior Technical Analyst at Swastika Investmart

The Bank Nifty is approaching its 200-DMA (49,775), with key support at 49,600. A bounce-back is likely from the 50,000–49,600 zone. On the upside, 50,600–51,000 serves as immediate resistance, with the next hurdle at 51,500.

Key Resistance: 50,600, 51,500

Key Support: 50,000, 49,600

Strategy: Consider selling Bank Nifty on a rise near 50,600–50,800, with a stop-loss at 51,000, targeting 49,600.