Benchmark index Nifty 50 ended the session on a flat note amidst a rise in volatility. It continues to face resistance at 17,950 levels and immediate support is at 17,800 where maximum open interest has been built on the Call and Put options, respectively, suggesting a narrow range-bound activity ahead of the September expiry session on Thursday.
However, a breakdown from the immediate support of 17,800 can trigger corrections to levels of 17,700-17,600. On the flip side, a sustained trade above 17,950 will resume the uptrend to take the index higher to levels of 18,080-18,100. However, technical indicator RSI continues to head south after forming a negative divergence on a shorter timeframe suggesting a possible pause in the uptrend in the coming sessions. Moreover, traders should also keep a close eye on the India VIX which is moving up gradually.
Equity recommendations
| Buy @ CMP of Rs 85.60
Target: Rs 100
Stop Loss: Rs 78
The stock has broken out of a bullish pennant pattern on good volumes, triggering a resumption of the uptrend. Technical indicator RSI has turned upwards after taking support at the 40 level, suggesting strength in the stock.
| Buy @CMP of Rs 182
Target: Rs 198
Stop Loss: Rs 174
The stock has resumed its uptrend after testing the trendline support in the recent throwback. Further, RSI has also turned upwards after formation of a positive reversal pattern.
(The author, Aditya Agarwala, is a Senior Technical Analyst, YES Securities)
