Trading Plan: Will Nifty 50 manages to climb 24,500, Bank Nifty hit 51,000?

Nifty Trading Strategy

The market performed remarkably well on August 12, despite the panic created over the weekend by the Hindenburg news, closing with only moderate losses. Looking ahead, the 24,400-24,500 range is the immediate hurdle on the higher side for the Nifty 50. A decisive close above this level could open the doors for the 24,700-24,800 zone. However, below this range, consolidation may continue, with 24,200 acting as support. The Bank Nifty is likely to inch towards 51,000, while 50,150 is expected to act as support, experts said.

On Monday, the Nifty 50 fell 21 points to 24,347, while the Bank Nifty rose 94 points to 50,578. On the NSE, 1,267 shares declined, while 1,136 shares advanced.

Nifty Outlook and Strategy

Mehul Kothari, DVP – Technical Research at Anand Rathi

The 24,400 level, which has been a trendline breakdown point, is acting as a strong hurdle for the Nifty 50. The index failed to close above this level. In the coming sessions, only a close above 24,400 would confirm a strong base around 24,000, potentially leading to new highs. On the downside, 24,200 remains immediate support for the markets.

Key Resistance: 24,400, 24,500

Key Support: 24,200, 24,000

Strategy: Buy Nifty on a close above 24,400.

Pravesh Gour, Senior Technical Analyst at Swastika Investmart

Technically, the Nifty is attempting to form a near-term bottom around its 50-day moving average (DMA) at 24,000. However, the 20-DMA at approximately 24,525 remains a critical resistance level. If the index manages to sustain above the 20-DMA, we could anticipate a short-covering rally towards the 24,800 level. On the flip side, failing to break above this hurdle could trigger another round of selling. Should the Nifty drop below its 50-DMA, the next support zone is likely in the range of 23,700 to 23,400.

Key Resistance: 24,525, 24,800, 25,000

Key Support: 24,000, 23,700, 23,400

Strategy: Consider selling near the 20-DMA at around 24,525 with a stop-loss of 24,600 and a target of 24,000. Conversely, consider buying near the 50-DMA at around 24,000 with a stop-loss of 23,800 and a target of 24,525.

Kushal Gandhi, Technical Analyst at StoxBox

From a technical perspective, the 50-day moving average (24,004), representing institutional support, implies a potential pullback. Validating this assumption necessitates continued price action, potentially categorizing the recent sell-off as a shakeout event. Affirmation of a pullback mandates a decisive close above 24,720. In such circumstances, it is judicious to adopt a stock-specific approach with stringent risk management or to exercise patience for further confirmation while retaining market positioning.

Key Resistance: 24,450, 24,600, 24,720

Key Support: 24,190, 24,000, 23,890

Strategy: Initiate a long position in Nifty with a target of 24,850 and maintain a strict stop-loss of 23,980.

Bank Nifty - Outlook and Positioning

Mehul Kothari, DVP – Technical Research at Anand Rathi

The Nifty Bank index outperformed the benchmark Nifty 50 during the session. However, the index failed to clear the hurdle of 51,000. Going ahead, a move above 51,000 could bring the index out of danger. On the downside, 50,000 seems to be an important support for the coming sessions.

Key Resistance: 51,000, 51,500

Key Support: 50,500, 50,000

Strategy: Buy Bank Nifty above 51,000, with a stop-loss of 50,700 and a target of 51,600.

Pravesh Gour, Senior Technical Analyst at Swastika Investmart

Bank Nifty is trying to establish a base around its 100-DMA at 50,000 after a period of prolonged underperformance. The 20-DMA at approximately 51,200 will be a significant challenge for any potential bounce-back. If Bank Nifty manages to break above this level, we could see a short-covering move towards 52,000. However, if the index falls below its 100-DMA, fresh selling pressure could push it down towards the 48,500 level.

Key Resistance: 51,200, 52,000

Key Support: 50,000, 48,500

Strategy: Consider buying on dips near 50,000, with a stop-loss of 48,500 and a target of 52,000.

Kushal Gandhi, Technical Analyst at StoxBox

The banking index has undergone a correction of approximately 7 percent from its peak, retracing to a multi-month positive sloping trendline. This trendline is reinforced by the 100-day moving average, which is currently serving as robust immediate support. Notably, during the previous week, the banking index demonstrated resilience to further drawdowns and exhibited reduced volatility and enhanced relative strength compared to the Nifty 50 index, signaling a positive trajectory. The index is anticipated to gain bullish momentum, given that the level of 49,700-49,500 remains unbreached on a closing basis.

Key Resistance: 50,750, 51,100, 52,350

Key Support: 50,150, 49,600, 49,000

Strategy: Initiate a long position in Bank Nifty with a target of 52,350 and maintain a strict stop-loss of 49,600.

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