The Nifty 50 snapped a two-day losing streak and closed with moderate gains, though it failed to move back above the 10-day EMA. The index continued its lower high–lower low formation on a daily basis for the third straight session on October 3, but remained well above the 20-day and 50-day EMAs.
The RSI (at 58.99) and Stochastic RSI showed a bearish crossover, while the MACD was on the verge of a negative crossover with a flat histogram — signaling some caution and possible consolidation in the short term.
Further, the India VIX, the fear index, extended its upward movement for the sixth straight session, approaching the 13 zone (near the 200-day Exponential Moving Average). It rose 4.22 percent to 12.67, marking its highest closing level since June 30 this year, indicating growing caution among bulls.
Experts expect the consolidation phase to continue in the index, with support at 25,650-25,600 and resistance at 25,800–25,950 in the upcoming sessions. Beyond this, the 26,000–26,100 zone will be the next area to watch. However, a decisive break below the key support could open the door for bearish action toward 25,500.
The Nifty 50 traded in a narrow range of around 100–150 points before closing the day at 25,763, up 41 points, forming a bullish candle with minor upper and lower shadows on the daily timeframe — indicating a positive bias amid volatility.
Structurally, while it may appear that not much has changed, a closer look reveals that prices successfully defended the key support zone around 25,650–25,600. This area coincides with the bullish breakout zone of the June swing high near 25,670, as well as the 20-DEMA support.
“It is common for price action to retest breakout zones before attempting further upside, and this retest is now clearly visible on the charts,” said Rajesh Bhosale, Equity Technical Analyst at Angel One.
Going ahead, he advised maintaining a buy-on-dips approach, with 25,650–25,600 acting as the immediate support zone, followed by 25,500 as the next strong retracement support.
On the flip side, resistance is seen around 25,900–26,000, while the upper band of last week’s range near 26,200–26,300 remains a major hurdle for the bulls, he added.
The weekly options data continues to show 26,000 as a strong resistance level for the Nifty 50, while support lies in the 25,700–25,500 range.
The maximum Call open interest (OI) was observed at the 26,000 strike, followed by 25,900 and 26,100 strikes, with the maximum Call writing at the 25,750, 25,800, and 25,850 strikes.
On the other hand, the 25,700 strike holds the maximum Put open interest, followed by 25,600 and 25,500 strikes, with maximum Put writing seen at the 25,700, 25,650, and 25,600 strikes.
Bank Nifty View
The Bank Nifty outperformed the benchmark Nifty 50, rising 325 points to 58,101, and formed a bullish candle with a minor upper shadow on the daily chart — indicating a positive trend with mild profit-booking at higher levels, supported by buying in PSU banks. The index traded within the previous day’s range.
After climbing above the 10-day EMA, the banking index traded above all key moving averages. However, the MACD showed a bearish crossover, with the histogram slipping below the zero line for the first time in a month. The RSI (65.6) and Stochastic RSI also remained in a negative crossover.
According to Sudeep Shah, Head – Technical Research and Derivatives at SBI Securities, the 57,650–57,700 zone is likely to act as an important support area, while resistance is placed around 58,250–58,350.
A decisive breakout above 58,350 could pave the way for an upside move toward 59,000 in the short term, he added.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
