The Nifty 50 experienced a sharp decline on November 28, breaking decisively below the psychological 24,000 mark. This drop came after three days of consolidation, forming a long bearish candlestick pattern on the daily charts. The expiry of the November Futures & Options contracts played a key role in this movement. According to market experts, the index now signals more weakness ahead, with the potential to test levels near 23,600, its 200-day EMA (exponential moving average).
Key Developments:
- Index Performance
The Nifty 50 started the day on a flat note, initially climbing towards 24,350 in early trade. However, it failed to maintain upward momentum and erased gains swiftly. By the end of the day, the index fell by 361 points (1.5%), closing at 23,914 with volumes above the average. - Critical Levels to Watch
- A break below 23,600 could open doors for the November low of 23,263.
- On the upside, a rebound might face immediate resistance at 24,100.
- Bearish Signals
The session’s weakness has completely filled the gap created on November 25, nullifying the recent sharp recovery from 23,263 to 24,354. The inability to sustain above the 100-day and 50-day EMAs further indicates bearish sentiment.
Expert Insights:
Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, pointed out that the current dip could be a “buy on dips” opportunity. He highlighted the 23,900–23,600 zone as a strong support area, coinciding with the 200-day EMA and the recent gap. A higher-bottom reversal confirmation from this zone could trigger another upside bounce.
Strategy for Traders:
- For Buyers: Look for opportunities between 23,900 and 23,600 for potential reversal signals.
- For Sellers: A break below 23,600 could pave the way for further downside, targeting 23,263.
- For Short-Term Players: Monitor resistance at 24,100 for any signs of recovery.
Conclusion:
The current dip in Nifty 50 presents both challenges and opportunities. While bearish momentum dominates, traders must stay vigilant for signs of reversal near key support levels. The coming sessions in the December series will be crucial for determining the index’s next move.
