The Nifty ended lower on January 19 after a healthy pullback in the previous session on negative global cues as US Fed officials retained a hawkish stance to bring inflation down.
The index opened lower at 18,120 and moved in the 18,155-18,064 range. The index finally settled 58 points lower at 18,108. Most sectors, barring oil & gas, and IT, closed in the red.
The Nifty formed Inside Bar and Doji pattern on the daily chart on January 19. A Doji candle is formed when the closing level is near its opening level, indicating indecisiveness among buyers and sellers about future market direction.
Hence, 18,000 is expected to act as a crucial support followed by 17,900, whereas 18,200 is likely to be key hurdle for the Nifty, experts said.
“After a promising pullback rally the Nifty has formed an inside body candle, which is indicating non-directional activity,” Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities said.
For traders, 18,050 would be the immediate support; below it, the index can slip to 17,950-17,900. Above 18,050, the index can retest 18,200, the market expert said.
India VIX, the fear index, was down by 2.85 percent from 14.37 to 13.96 levels. It needs to sustain below 14 for the market to resume the uptrend, experts said.
The Options data indicated that the Nifty may trade in the range of 18,000-18,300 in the coming sessions.
The maximum Call open interest was at 18,500 strike followed by 18,200 and 18,100 strikes, with Call writing at 18,500 strike then 18,100 and 18,200 strikes. On the Put side, the maximum open interest was seen at 18,000 strike followed by 17,500 & 18,100 strikes, with Put writing at 17,500 strike then 17,600 & 18,100 strikes.
Banking index
The Bank Nifty opened negative at 42,416 and moved in a consolidative manner throughout the session, underperforming the broader markets. It moved in a narrow range of 270 points and closed with losses of around 129 points at 42,329.
The banking index formed a bearish candle and an Inside Bar pattern on the daily scale. Now the index needs to hold above 42,222 to make an upmove towards 42,555 and 42,750, whereas supports are placed at 42,222 then 42,000.
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