Nifty Outlook for 22 August 2023
Our markets started trading for the week on a flat note, but we witnessed some buying interest around 19300. Nifty crept higher gradually during the day and it ended around 19400 with gains of about half a percent.
Nifty has been consolidating within a range since last few days, wherein 19300-19250 has been acting as a support zone. This range, where 50 DEMA coincides with the 23.6 percent retracement level of last four months upmove has now become the immediate support zone. In options segment, 19300 put options witnessed addition in open interest in Monday’s session, while 19400 call option has highest open interest. Also, the 20 DEMA and a falling trendline resistance is seen around 19480. Thus, it seems that the index could consolidate within a narrow range of 19300-19500 in the near term. A breakout beyond this range would then lead to a directional move and hence, traders are advised to trade with a stock specific approach here. One should keep a close watch on the open interest positions as well, and any significant unwinding in options could give a hint towards the probable near term breakout direction.
Nifty forms a short term support base at 50 DEMA
The overall market breadth has been positive in this recent corrective phase which is a positive sign. Hence, only a break below 19300-19250 will be a cause of worry and till then, the biasness remains sideways to positive.
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