Indian benchmark index Nifty 50 is prone to witness a near-term rebound, in keeping with Axis Securities. For the second consecutive month, the index examined its prior provide zone of 25,600-25,700 ranges; nevertheless, revenue reserving at elevated ranges dragged it decrease, leading to a 2.9% loss.
The index has misplaced half a p.c in August to date, following a 3 p.c decline in July. Earlier than that, it was within the inexperienced for 4 straight months, up 3 p.c in June, 1.7 p.c in Could, 3.5 p.c in April, and 6.3 p.c in March.
Axis Securities highlighted that the index continues to maneuver increased on a broader timeframe, forming a constant collection of upper tops and better bottoms on the long-term chart. This implies that minor corrections towards recognized assist zones supply buyers a strategic alternative for accumulation.
Axis Securities suggested buyers that they need to undertake a buy-on-dips strategy, as short-term corrections present engaging entry factors. The short- to medium-term pattern seems impartial to corrective, however Nifty’s near-term upside might prolong towards 25,300–25,500. On the similar time, any violation of the 24,400 assist stage could result in revenue reserving, probably dragging the index all the way down to 24,000–23,800, it predicted.
Axis Securities famous that the month-to-month worth motion fashioned a small bearish candle confined throughout the high-low vary of the earlier month, indicating a short lived lack of robust upward momentum. The index stays above its 200-day Easy Transferring Common (SMA) at 24,042, reconfirming the first uptrend.
Whereas the weekly and month-to-month Relative Power Index (RSI) are in unfavourable territory, signaling short-term lack of power, Axis Securities emphasised that the long-term pattern stays constructive. Since June 2022, Nifty has constantly revered its upward-sloping channel assist, underscoring the resilience of the present uptrend.
Key Help and Resistance Ranges to Watch
Axis Securities defined that the 200-day SMA round 24,000 is a crucial assist stage and a strategic accumulation zone. At the moment, the index is buying and selling close to a multi-month assist zone between 24,500 and 24,300, which serves as a vital line of protection.
A sustained breach beneath this zone might speed up corrective momentum, probably pushing Nifty towards the 24,000 psychological stage. Regardless of this consolidation, the RSI holding above 50 signifies underlying power, supporting constructive momentum. Axis Securities recommends a selective, stock- and sector-specific technique to capitalize on market alternatives.
On the upside, Axis Securities said {that a} sustained breakout above 25,000 might set off a rally, with potential targets within the 25,300–25,500 vary. Conversely, a decisive breach of the assist zone at 24,400–24,300 could immediate revenue reserving, presumably driving the index towards 24,000–23,800.
Axis Securities additionally noticed that Nifty is in a corrective mode within the quick time period, mirrored in a collection of decrease tops and bottoms, and continues to face resistance from its prior provide zone of 25,400–25,600. However, the broader outlook stays bullish, with potential for sector rotation throughout the ongoing bull market.
Disclaimer: The views and suggestions made above are these of particular person analysts or broking corporations, and never of Mint. We advise buyers to verify with licensed consultants earlier than making any funding choices.
