The broader markets had a flat close with the Nifty Midcap 100 index declining 0.05 percent and Smallcap 100 index rising 0.24 percent.
The Nifty50 opened lower on November 21 and remained sideways with negative bias throughout the session. It settled with nearly 150 points loss, forming yet another bearish candle on the daily charts with negative divergence in the relative strength index (RSI). Weak global cues and selling in almost all the sectors weighed on the sentiment.
The index has managed to take support at 18,100 in Monday’s correction. With negative divergence in RSI, the weakness might continue with crucial support at 18,000, whereas the upside is likely to be capped at 18,450, experts said.
The Nifty50 started off trade down at 18,246 and fell up to 18,133 intraday. Finally, it settled with 148 points gains at 18,160.
“On the lower end, it slipped towards the previous swing high (18,100). The trend looks weak with a rounding top formation on the daily timeframe. The bearish crossover in RSI with a negative divergence suggests weak momentum,” said Rupak De, Senior Technical Analyst at LKP Securities.
Going forward, De feels 18,100 may provide immediate support, below which the index may drift down towards 17,750. On the higher end, resistance is visible at 18,200-18,450, the expert said.
The Option data suggested that the Nifty50 may see an immediate trading range of 18,000-18,400 levels for coming sessions, or at least for the current monthly expiry week.
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We have seen maximum Call open interest at 19,000 strike followed by 18,500 strike while the maximum Put open interest was seen at 18,000 strike then 17,500 strike.
The meaningful Call writing was seen at 18,200 strike then 18,300 strike while Put writing was seen at 17,900 strike followed by 18,000 strike.
India VIX was up 2.83 percent to 14.80 level, but overall remained at lower levels.
Bank Nifty also opened negative at 42,287 and moved in a range of around 175 points throughout the session. It comparatively outperformed the broader markets but closed with losses of 91 points at 42,347.
The banking index has formed a small-bodied bullish candle on the daily frame and took support near the 42,200 level. It has to cross and hold above 42,350 levels to make a move towards 42,750 and 43,000 with supports at 42,200 and 42,000 levels, Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services said.
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The broader markets had a flat close with the Nifty Midcap 100 index declining 0.05 percent and Smallcap 100 index rising 0.24 percent.
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