Nifty Trade Setup

The market failed to sustain its intraday gains as bears took back control over Dalal Street in late trade, driving the benchmark indices down marginally amid volatility on October 9. This followed the RBI's decision to hold the repo rate at 6.5 percent and change its policy stance to neutral. However, the Nifty 50 managed to sustain its previous day's low with a higher high formation. According to experts, the index is likely to consolidate until it gives a decisive close above 25,300, with support in the 24,750-24,700 area. If it moves above 25,300, the next level to watch is 25,500. For the Bank Nifty, support lies at 50,500, while the index faces resistance in the 51,700-51,800 zone on the upside.

On Wednesday, the Nifty 50 closed at 24,982, down 31 points. The Bank Nifty declined by 14 points to 51,007, despite a strong breadth in the market. On the NSE, about 1,708 shares advanced, while 802 shares declined.

Nifty Outlook and Strategy

Vidnyan S Sawant, Head of Research at GEPL Capital

After forming a significant bearish candle in the previous week, the Nifty 50 has continued its lower top-lower bottom formation, breaking below the prior swing low of 24,753. Although there was a sharp rebound to the 25,234 level, the index couldn't sustain this level and slipped back under the 25,000 mark. Based on the current chart structure, the index remains weak, with the RSI (Relative Strength Index) indicator positioned below 50 and trending downward on the daily charts, suggesting increasing bearish momentum. Immediate support is at 24,694, with further support at 23,900. On the upside, resistance stands at the recent high of 25,234, followed by 25,500.

Key Resistance: 25,234, 25,500

Key Support: 24,694, 23,900

Strategy: Sell Nifty below 24,694 for a target of 23,900, with a stop-loss at 25,050.

Shitij Gandhi, Senior Technical Research Analyst at SMC Global Securities

Technically, the Nifty has breached its key psychological level of 25,000 on a spot basis and is likely to remain under pressure due to long unwinding at higher levels.

Key Resistance: 25,300, 25,500

Key Support: 24,900, 24,700

Strategy: Sell on rallies near 25,300, with a stop-loss above 25,500, targeting 24,900.

Jatin Gedia, Technical Research Analyst at Sharekhan by BNP Paribas

On the daily charts, we observe that Nifty is in a pullback mode after correcting nearly 1,500 points from its record high. We believe that the pullback is not complete and that there is scope for further upside until 25,350 – 25,500. Therefore, intraday corrections should be used as buying opportunities. One should keep a stop-loss of 24,800 for long positions.

Key Resistance: 25,350, 25,500

Key Support: 24,850, 24,800

Strategy: Buy Nifty 50 with a stop-loss of 24,800, targeting 25,350.

Bank Nifty - Outlook and Positioning

Vidnyan S Sawant, Head of Research at GEPL Capital

The Bank Nifty has formed an Evening Star pattern on the weekly charts at a record high, signaling a bearish outlook for the medium term. This week, the index continued its lower top-lower-bottom formation, reflecting a bearish undertone. The RSI (Relative Strength Index) is below the 45 level and trending downward, having also shown a bearish divergence at overbought levels on the daily charts, indicating strengthening bearish momentum in the short to medium term. On the upside, Bank Nifty faces immediate resistance at 51,800, followed by 52,900 and 53,700. On the downside, support is at 50,200, with further support at 49,600.

Key Resistance: 51,800, 52,900

Key Support: 50,200, 49,600

Strategy: Sell Bank Nifty at CMP for a target of 49,600, with a stop-loss of 51,800.

Shitij Gandhi, Senior Technical Research Analyst at SMC Global Securities

The Bank Nifty somehow managed to settle near the unchanged line after witnessing a volatile session on October 9. From a short-term perspective, we anticipate consolidation within a broader range of 50,000-52,000. However, the bias is likely to remain in favor of bears, as bulls seem to be losing control over the markets amid ongoing geopolitical tensions. Investors should keep an eye on crucial support levels, which are currently positioned between 50,400 and 50,000. Overall, the market appears poised for potential selling pressure once again at higher levels as it navigates through the defined range.

Key Resistance: 51,500, 52,000

Key Support: 50,500, 50,000

Strategy: Sell Bank Nifty on a rise near 51,600, with a stop-loss above 52,000, targeting 50,700.

Jatin Gedia, Technical Research Analyst at Sharekhan by BNP Paribas

We expect the Bank Nifty to trade within a range over the next few trading sessions. The range of consolidation is likely to be 50,500 – 52,500.

Key Resistance: 51,600, 51,700

Key Support: 50,500, 50,400

Strategy: Buy Bank Nifty with a stop-loss at 50,400, targeting 51,700.