Technicals point to potential rebound in Nifty

Some technical indicators and positioning in derivatives point to a potential rebound in Nifty, which as of Tuesday had fallen 5.4 percent since its record closing high on January 23.

The biggest number of open interest February contracts are at 6,000 puts, suggesting investors expect that to be a strong support level.

Technically, the NSE is trading just above the daily relative strength index (RSI) of 30, which has been a strong support level since August.

The NSE is also seeing strong support at 5,955.82, the 38.2 percent Fibonacci retracement on the rise from the August 28 close of 5,285 to the December 9 close of 6,363.90.