Technical View: Nifty ends below 23,700 in rangebound session; support at 23600-23500

Market Today

The Nifty50 index failed to build on the previous session gains and ended below 23,700 in the rangebound session on February 5.

Amid mixed global cues, the index opened on a positive note and stayed in a range in the first half with a positive bias, however, due to extended selling it failed to hold on to the opening gains and ended lower at 23,696.30, down 42.95 points or 0.18 percent.

Top losers on the Nifty were Asian Paints, Titan Company, Nestle India, HUL, and Britannia Industries, while gainers included Hindalco Industries, ONGC, Apollo Hospitals, BPCL, and Adani Ports.

Among sectors, except FMCG, Consumer Durables, realty and auto, all other indices ended in the green with oil & gas, metal, media, energy, and PSU bank added 1-1.8 percent.

The broader indices outperformed the main indices with the Nifty midcap index adding 0.7 percent and the Nifty smallcap index rising nearly 2 percent.

"Technically, after a positive opening, the market registered intraday selling pressure at higher levels. However, the short-term texture of the market is still on the positive side. A small bearish candle formation on the daily charts and lacklustre intraday activity indicate the continuation of non-directional momentum in the near future," said Shrikant Chouhan, Head of Equity Research, at Kotak Securities.

"The current market texture is non-directional; hence, levels-based trading would be the ideal strategy for day traders. On the downside, 23600/78000 and 23500/77700 would be the key support zones, while 23800-23900/78700-78900 could act as crucial resistance areas for traders. However, below 23500, /77700 traders may prefer to exit their long positions," he added.

After the strong start, the Bank Nifty index extended the gains to move above 50,500 but despite some profit booking the index ended 0.37 percent higher at 50,343.05.

"Bank Nifty ended with a consolidative candle, maintaining a bullish bias despite evident nervousness ahead of the Delhi exit polls. Price action and volume reflected caution among traders. For the bullish momentum to continue, the index must sustain above 50,400. If it holds this level, an upside move towards 50,800-51,000 remains possible," said Anshul Jain, Head Of Research, Lakshmishree Investments.

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