Nifty breached the 22850-22820 support level, turning the short-term trend negative. Jatin Gedia said, "Failure to hold the crucial support zone of 22850-22820 is a concern." The market now expects Nifty to drag towards 22550-22500. Meanwhile, Bank Nifty also turned weak after falling below the previous low of 54,708.
Market outlook
Nifty breached the rising channel support at 22850-22820 on the downside, turning the short-term trend negative again. Pullbacks towards 22900-22920 are likely to attract selling pressure. On the downside, the crucial support is now placed at the 22550-22500 zone, which coincides with the 61.8 per cent Fibonacci retracement level of the 22180-23175 rally. The resistance zone shifts lower, now ranging from 23170 to 23000.
The daily momentum indicator has a positive crossover; however, failure to hold the crucial support zone of 22850-22820 is a concern, and we expect the Nifty to drag towards 22550-22500 from a short-term perspective.
Bank Nifty, which was holding on and relatively outperforming, has also turned weak after breaching below the previous weak low of 54,708. It formed a large bearish candle on the daily charts, offsetting the positive price action of the previous five trading sessions. Resistance shifts lower towards 55,400-55,500 while the crucial support zone is placed at 54,400-54,300. We expect the Bank Nifty to drag lower towards the support zone over the next few trading sessions. CHECK Stock Market LIVE Updates
Stock recommendations for today by Jatin Gedia
Sell Apollo Hospital Oct Fut @ ₹7612; SL - ₹7715; TGT - ₹7400
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The stock is in a downtrend. Apollo Hospitals broke down from a triangle pattern on the downside, suggesting the resumption of the next leg of the decline. MACD has a negative crossover, which is a sell signal.
Sell Bajaj Finance Oct Fut @ ₹924; SL - ₹945; TGT - ₹900
Bajaj Finance stock has broken down from a bearish flag pattern on the daily charts, suggesting the resumption of a downtrend. A fresh negative crossover on the momentum indicator suggests a sell signal.
Buy IPCA LABS - ₹1921 SL - ₹1885 TGT - ₹2037
IPCA Labs has found buying interest at 1813, which coincides with the 61.8 per cent Fibonacci retracement level of the 1680 - 2030 rally, and it formed a large-bodied bullish candle on the daily charts. MACD is turing from the equilibrium line suggesting that the pullback is over and the stock is likely to resume its uptrend.