The steep fall dragged the 50-pack index below its crucial support at the 50-day moving average, with the index now placed near its recent swing low. Analysts said Nifty may face resistance in the 14,630-14,700 zone while support is seen in the 14,450-14,470 range.
Aditya Agarwala of YES Securities said the market is in firm bear grip, as it has made lower lows throughout the week.
“Nifty50 has closed below its crucial support line of 50-DMA, placed at 14,730, which also happens to be the channel support line, confirming weakening uptrend. A sustained trade below the recent low of 14,450 could extend the fall to the post-Budget gap area at 14,330. On the upside, 14,700 level will act as an immediate hurdle,” Agarwala said.
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Sameet Chavan of Angel Broking said Nifty was back to the post-Budget gap, which had been created around 14,470-14330. He said a sustainable breach below 14,470 level would open the floodgates for an extended correction.
“For the coming session, the 14,630 level followed by 14,700 would be seen as intraday resistances for Nifty50,” he said.
Manish Shah said the average directional index (ADX) has dipped below the threshold value of 25, which indicates sideways action. He said the Stochastic oscillator is in the oversold region.
Shah said Nifty is at its crucial support and a recovery from here on cannot be ruled out.
“Nifty50 has hit the rising trendline from the September 24 low point and this has emerged as the support zone. It is sufficient to say that the index is at a strong support level and there is a great chance that Nifty would recover in a day or two,” Shah said.
