Technical View: Nifty forms long bullish candle, 22,500 in sight

Nifty eyes 22,500 in coming sessions

The Nifty made a recording-breaking start to the March series, clocking the biggest single-day gains in a month to close above the 22,300 mark for the first time.

Buying across sectors, barring technology and pharma, and better-than-expected third-quarter GDP numbers boosted the sentiment.

The index opened above 22,000 points and gained strength as the day progressed. It hit a record high of 22,353 in the late trade but pared some of the gains. It ended the day at 22,339, up 356 points or 1.62 percent, its best closing and the biggest single-day gain since January 29. It formed a long bullish candlestick on the daily chart.

Following a decisive close above 22,300 and a break out of the consolidation range (21,950-22,300), the Nifty looks strong and may move to 22,500-22,600 levels in the coming sessions. experts said. Immediate support is at 22,200.

Nagaraj Shetti, senior technical research analyst, HDFC Securities, said the short-term trend remains positive and the sharp upside breakout is expected to continue in the coming sessions.

"The next upside targets to be watched around 22,500-22,600 levels. Immediate support is at 22,200 levels," he said.

On the weekly options front, the maximum Call open interest was at the 23,000 strike followed by the 22,800 strike and 22,500 strike, with meaningful Call writing at the 22,800 strike and then 23,000 strike. On the Put side, the 22,000 strike owned the maximum open interest followed by 22,200 strike and 22,100 strike, with writing at similar strikes.

The data indicates the Nifty is likely to face resistance at 22,500, with support at 22,200 level.

The market will remain open for a couple of hours of special live trading session on March 2 to test the transition from the primary site (PR) to the disaster recovery site. The session is aimed at strengthening the functioning of exchanges in case of an emergency such as a security breach.

Bank Nifty was the second biggest sectoral gainer after the metal index, moving decisively above 47,000.

The banking index surged 1,166 points, or 2.53 percent, to 47,287 and formed a robust bullish candlestick pattern on the daily charts, though the volume was lower than average.

"The current support for the index is established in the range of 47,000-46,900, and any pullback towards this support zone is seen as a favourable buying opportunity," Kunal Shah, senior technical & derivative analyst at LKP Securities said.

There is a strong chance that the index is poised to surpass its all-time high of 48,500 mark in the near term, he said.

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