Domestic benchmark indices are expected to open on a cautious note on Wednesday, August 12, after the Sensex and Nifty 50 ended Tuesday’s session lower amid a sharp rally in crude oil prices due to geopolitical uncertainties denting investors’ sentiment, profit booking and selling pressure across key sectors.
Technical experts expect the near-term market trend to remain range-bound, with crucial support levels likely to determine whether the recent weakness deepens or the indices stage a recovery.
Sensex, Nifty at close on Wednesday, August 12
However, the index continues to trade well above its 20-Day, 50-Day and 100-Day EMAs, suggesting that the broader medium-term trend remains relatively resilient, he stated, adding the RSI stands at 54.82, remaining above the neutral 50 mark and indicating that momentum is still balanced rather than decisively bearish.
“The PCR at 1.17 also suggests relatively supportive positioning, though further confirmation is required,” Gupta added.
Gupta further stated the price action indicates that the Sensex witnessed selling pressure from higher levels and failed to sustain above the 78,500 mark. “The immediate support zone is placed at 78,000–77,800, while resistance is seen at 78,500–78,700. The broader trading range stands at 77,800–78,700, with the near-term bias remaining sideways,” the analyst said.
A sustained hold above the support zone could encourage recovery, while a decisive break below 77,800 may intensify downside pressure, he added.
Gupta said the broader outlook remains sideways, with the index caught between important support and resistance levels. “Sustaining the 78,000–77,800 zone will be crucial to prevent further weakness, while a decisive move above 78,500–78,700 could restore positive momentum. Until a clear breakout or breakdown emerges, traders may prefer a cautious approach and closely monitor key levels for the next directional signal,” Gupta concluded.
“On the upside, 24,575–24,650 is the immediate resistance band, where sustained selling pressure has emerged. A decisive breakout above this zone would strengthen the short-term momentum, while a break below 24,300 could lead to further profit booking,” he further stated.
“Indian indices witnessed profit booking during Today’s session, with Nifty 50 closing at 24,471.70, down 112.10 points (-0.46%). The index opened on a flat note and remained under pressure through most of the session, slipping from higher levels and closing near the lower end of the day’s range. The daily chart continues to show the index holding above its broader rising trendline, but the rejection from the 24,500+ zone indicates supply at higher levels. RSI stood at 56.10, retaining a positive zone despite the day’s decline,” Tailor said.
A reasonable negative candle was formed on the daily chart that signals lacklustre movement in the market over the last six sessions. This gradual weakness with range bound action signals a chance of some more dip down to the crucial breakout area of 24300 levels before bouncing back from the lows, he further stated.
“The larger degree bullish pattern like higher tops and bottoms is intact as per daily and weekly timeframe chart and present weakness could be in line with the formation of new higher bottom of the sequence. But the higher bottom reversal needs to be confirmed,” Shetti added.
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Nifty Daily Chart – Tuesday, August 11
The consolidation/choppy movement is likely to continue for the short term. The next lower supports to be watched around 24300 levels, the analyst concluded.
