Nifty opened positive on Wednesday, but failed to hold above the 11,250 level and corrected towards 11,024 level. However, it witnessed a good recovery from lower levels. The bounces got sold into near the intraday hurdle at 11,250 level. The index continued its losing streak into the fifth consecutive session and made lower top and bottom on the daily scale before closing below its 50 DEMA. This gives an upper hand to the bears in this market.
The index formed a Bearish Belt Hold pattern as it made an opening high and remained under pressure at every small bounceback. As long as the index sustains below 11,250 level, the bounce could be sold into for further weakness towards 11,000 level, while on the upside, the medium-term hurdle has shifted lower to the 11,333-11,350 zone.
India VIX fell 1.96 per cent from 21.41 to 20.99 level. The cooling down of volatility despite the weakness in the market indicates a rangebound movement over the next few sessions with the upside capped.
Nifty futures closed negative at 11,146 level with a loss of 0.14 per cent. The trade setup looked positive Tata Chemicals, Bata India, Ramco Cement, Apollo Hospital, VEDL and Escorts but it was weak seen in Bharti Infratel, Shriram Transport, LIC Housing Finance, ZEEL, Tata Steel, Motherson Sumi, IndusInd Bank, BHEL, Tata Consumer, Indiabulls Housing Finance, Marico and Bajaj Finance.
(Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)
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