Tech View: Nifty takes support at all-important 11,300 level to avert big selloff

NEW DELHI: The Nifty50 extended its slide into the fourth straight session on Tuesday. Selling pressure was observed in intraday trade, preventing the index from reclaiming the 11,400 level. That said, buying around its crucial support of 11,300 helped avert a major selloff.

Technically, nothing much has changed, and the real pain still lies in the banking pocket, said Sameet Chavan of Angel Broking.

“A major support lies at 11,300, which is the convergence point of multiple technical evidence. If we manage to hold it, the possibility of a similar kind of intraday rally cannot be ruled out. In this scenario, 11,400 and 11,500 are the levels to watch out for,” Chavan said.


For the day, the index closed 15.15 points, or 0.13 per cent, down at 11,331. It made a small bearish candle on the daily chart.

As long as the 11,300 level holds, Nifty is likely to continue consolidation, said Gaurav Ratnaparkhi, of Sharekhan.

“Hourly charts showed scope for extension on the downside post consolidation. Overall, the index is expected to test the 11,200 level, which is the equality with the first leg of the July decline. Thus, positional traders can maintain short positions and add fresh shorts below 11,300. A tight stop loss can be placed above 11,400,” he said.

Even as the indices traded in the oversold zone, lower time frame charts are yet to generate buy signals, said Mazhar Mohammad of Chartviewindia.in.

Traders are advised to remain neutral on the long side until some signs of strength get visible, Mohammad said.