The Nifty 50 wiped out all its previous day’s gains and remained below the 200 DEMA (23,540) for the fifth consecutive session on November 21. With a red candle and the continuation of lower highs-lower lows formations, the index may fall toward 23,200 (50-week EMA) in the immediate term. However, if there is a recovery, then the 23,500–23,550 range can act as a resistance zone, as sustaining above it can take the index toward the 23,800 level, experts said. The Bank Nifty needs to hold the 50,000 mark for a move towards the 50,800–51,000 area, but below 50,000, 49,500 cannot be ruled out.
On Thursday, November 21, the Nifty 50 declined 169 points to 23,350, while the Bank Nifty fell 254 points to 50,373, with weak market breadth. About 1,824 shares corrected, compared to 658 rising shares on the NSE.
Nifty Outlook and Strategy
Ameya Ranadive, CMT CFTe, Senior Technical Analyst at StoxBox
The Nifty is trading near 23,340, hovering below a critical resistance zone at 23,800. Over the past week, this level has consistently acted as a barrier, with the Nifty failing to breach it decisively. A sustained move above this resistance could potentially signal a shift in market sentiment, paving the way for higher levels. On the daily chart, the index has repeatedly attempted to break above the 200-day EMA but has been unable to sustain these levels. A close above the 200 EMA is crucial for the next leg of the rally. Meanwhile, the RSI (Relative Strength Index) remains in oversold territory, reflecting weak momentum. The Nifty continues to make lower lows, further dampening sentiment.
On the options front, the maximum Call open interest was seen at the 24,000 strike, followed by 23,700 strike, with maximum Call writing at the 23,900 and 24,200 strikes, while the maximum Put open interest was observed at the 23,000 strike, followed by 23,500 strike, with maximum Put writing at the 23,700 and 23,600 strikes. The data suggests a broader trading range of 23,000 to 23,900, with a near-term range between 23,300 and 23,700.
Key Resistance: 23,800
Key Support: 23,000
Strategy: Sell 23,100 Put (November 28 expiry) at a premium of Rs 100, targeting Rs 185–210. The strategy will be invalid if the premium falls below Rs 50.
Hardik Matalia, Derivative Analyst at Choice Broking
On the daily chart, the Nifty index formed a strong bearish candle, indicating a continuation of the downward trend. If the index breaches the critical support level of 23,250, it could potentially extend its decline toward the 23,000–22,800 range. On the other hand, a sustained break above the 23,800 level may ease the selling pressure and signal a possible reversal, with 24,000 serving as the next key resistance. Traders are advised to consider fresh long positions only if the index decisively moves above 24,000. In the current volatile market conditions, maintaining caution and implementing robust risk management strategies are crucial.
Key Resistance: 23,500, 23,800
Key Support: 23,250, 23,000
Strategy: Sell on rise near 23,800 level for a target of 23,000 and 22,800 levels. Keep a stop-loss at 24,000 on a closing basis.
Chandan Taparia, Head - Equity Derivatives & Technicals, Wealth Management at Motilal Oswal Financial Services
The Nifty index faced continued selling pressure this week from upper levels but with less intensity, declining by 0.8 percent. Now, until it holds below the 23,500 zone, some weakness could be seen toward 23,100, then 22,900 levels, whereas hurdles are placed at 23,500, then 23,700 levels.
Key Resistance: 23,500, 23,700
Key Support: 22,900, 23,100
Strategy: Sell Nifty 50 on bounce with a hurdle of 23,500 for a downside target toward 23,100/22,900 levels.
Virat Jagad, Technical Research Analyst at Bonanza
The Nifty is currently trading in a bearish setup, forming a lower high, lower low pattern on the daily chart, indicating that the bears are in control. The index has recently broken down from a rounding top formation, with resistance near the 24,000 level. The RSI is in a lower range, confirming weakening momentum. These factors collectively suggest a shift towards negative sentiment, with the potential for further downside in the near term.
Key Resistance: 23,420, 23,500
Key Support: 23,000, 22,700
Strategy: Sell on rally near 23,800–23,900 levels, with a stop-loss of 23,420, for a downward move towards 23,300–23,000 levels.
Bank Nifty - Outlook and Positioning
Ameya Ranadive, CMT CFTe, Senior Technical Analyst at StoxBox
The Bank Nifty is currently trading around 50,400, consolidating within a range of 49,900 to 52,500 over the past month. The level of 49,900 is particularly significant, as the index has held above its 200-day EMA for over a week, bouncing back from this level multiple times. On the upside, the zone between 50,900 and 51,000 is a crucial resistance, marked by the convergence of the 20-day, 50-day, and 100-day EMAs. A breakout above this zone could trigger further upside momentum.
On the options front, the maximum Call open interest was seen at the 52,000 strike, followed by 52,500 strike, with maximum Call writing at the 51,000 strike, while the maximum Put open interest was observed at the 49,500 strike, followed by 49,000 strike, with maximum Put writing at the 51,000 strike. The Put-Call Ratio (PCR) has declined from 0.95 to 0.91, reflecting a tilt towards bearish sentiment. Additionally, implied volatility has decreased marginally from 17.70 percent to 17.42 percent, indicating reduced uncertainty.
Key Resistance: 51,350, 52,000
Key Support: 50,000, 49,800
Strategy: Sell 50,000 Put (December 27 expiry) at a premium of Rs 300, targeting Rs 650–720. The strategy will be invalid if the premium falls below Rs 150.
Hardik Matalia, Derivative Analyst at Choice Broking
On the daily chart, the Bank Nifty formed a small-bodied bearish candle with a long lower wick, reflecting buying interest at lower levels despite intraday weakness. If the index holds above its immediate support level, it could signal a short-term pause in bearish momentum. However, the index has struggled to sustain above its long-term 200-day EMA. Key support levels are at 50,200 and 49,800. A breakdown below these could intensify selling pressure, potentially dragging the index toward the 49,500 mark. On the upside, the 50,800–51,000 range is likely to act as a "sell-on-rise" zone unless the index decisively moves above the 51,200 level. Traders should closely monitor these key levels, as price movements around them will play a crucial role in determining the index's next directional trend.
Key Resistance: 50,800, 51,000
Key Support: 50,200, 49,800
Strategy: Sell on rise near 51,000 level for a target of 50,200–49,800 levels. Keep a stop-loss at 51,200 on a closing basis.
Virat Jagad, Technical Research Analyst at Bonanza
The Bank Nifty has been consolidating over the past 30 sessions within a range of 50,000 to 52,000. A breakout beyond this range is needed for further trend confirmation. The RSI is near the midline, supporting the ongoing rangebound movement. Additionally, the Bank Nifty is trading around its major EMAs, further confirming the consolidation phase in the index.
Key Resistance: 51,000, 51,500
Key Support: 50,000, 49,500
Strategy: Sell 51,000 Call and 50,000 Put for the current series expiry.
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.
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