Technically, the index closed below the level of 22,500, which has been acting as a minor support for the last couple of days. While this is a negative development, its not something that opens a big downside, observed an expert.
Going ahead, 22,500 level remains a significant resistance on the monthly expiry day, but a sustained trade above 22,500-22,550 could trigger further upward movement, potentially driven by contract adjustments.
Nifty 50 ends 0.4% higher at 22515 points, facing potential bearish reversal. On the daily chart, the index has formed a hanging man pattern, indicating a potential bearish reversal in the short term, said Rupak De, senior technical analyst at LKP Securities.
The short-term trend of Nifty is positive. Though it is placed at the crucial overhead resistance around 22,500 levels, there is no confirmation of any reversal pattern unfolding at the highs.
Nifty 50 held on to the crucial support zone of 21,900 – 21,850, which coincided with the 20-day moving average and the 50% Fibonacci retracement level of the rise from 21530 – 22249.