For the day, the index closed at 17,312.90, down 246 points or 1.4 per cent.
“The Nifty50 has decisively breached its 20-day-SMA (17,549), which offered some support in the recent fall. Hence, unless the Nifty50 bridges today’s bearish gap present in the zone of 17,380 and 17,590 levels, the trajectory of the index shall be on the downside. Meaningful support is present in the zone of 17,018 and 16,947, a bullish gap registered on July 29. Interestingly, the 200-day SMA is also placed (16,975) inside the said zone,” said Mazhar Mohammad of Chartviewindia.in.
Mohammad said the index can see resistance at 17,500 and unless the index closes above 17,550, all the pullback attempts shall remain vulnerable to a sell-off.
Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan, said the index had seen a minor degree bounce in the last week that retraced nearly 61.8 per cent of the first leg of the fall.
“Structurally, the index was gearing up for a down move. Accordingly, the index had a huge gap down opening on August 29. On the way down, the index breached the swing low of 17,345, which got retested with an intraday bounce. Although the index witnessed some recovery intraday, it is unlikely to sustain going ahead. 17,350-17,400 is an immediate resistance zone where the index is likely to attract another round of selling. Overall short-term target continues to be pegged at 17,000,” he said.
Kunal Shah, Senior Technical Analyst at said that the index has traded in a range on an intraday basis and held the support of 38,000.
The index is stuck in a broad range between 38,000-39,000 levels where demand and supply are visible, he said.
“If the index fails to hold the support of 38,000 on a closing basis, we will see an extension of the current sell-off. The immediate hurdle on the upside is placed at 38,500 and if breached can witness some short covering move toward 38,800-39,000 levels,” he said.
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