Nifty Reclaims VWAP, Momentum Indicators Hint at Gradual Recovery

Technical Analysis Report - Om Mehra, Technical Research Analyst, SAMCO Securities

Nifty closed at 23,659.00, gaining 0.17%, after recovering from an intraday low of 23,397.30. The daily chart formed a recovery candle; however, the index continues to trade within the broader Darvas Box formation. The close above the Volume-Weighted Average Price (VWAP), placed near 23,582, indicates some improvement in intraday participation following the early weakness. On the hourly chart, the descending trendline drawn from the recent highs is currently being tested, with the index closing near or marginally above this level. A sustained move above the trendline could trigger a short-term recovery attempt.

The RSI is placed near 45, reflecting marginal improvement in momentum, although it still remains below the neutral 50 mark. The MACD continues to trade in negative territory; however, the pace of downside momentum is gradually slowing. On the downside, the 23,400-23,350 zone remains the immediate support . On the upside, the 23,850-23,900 zone, aligned with the SMA band act as the immediate resistance. A decisive close above 23,800 would meaningfully improve the near-term outlook and increase the possibility of an extended recovery further.

Nifty Bank recovered from an intraday low of 52,836.10 to close at 53,562.20, gaining 0.29%. The session once again tested the lower Donchian Channel band, marking the third occasion in recent sessions where this level has been approached and successfully defended. The daily chart formed a bullish candle, indicating that buyers emerged near the lower support region and helped the index recover from intraday weakness.

On the hourly chart, higher lows are gradually forming from the 52,780 zone, suggesting that the index is attempting to build a short-term base. The RSI is placed near 41, reflecting marginal improvement in momentum, although it remains below the neutral mark. The MACD continues to trade in negative territory; however, the MACD line is positioned above the signal line, indicating that the pace of downside momentum has slowed.

On the downside, the 52,780-52,600 zone, aligned with the lower band of the Donchian Channel, remains the important support area. A decisive breach below this region would negate the ongoing base formation and may invite further weakness. On the upside, the 54,000-54,500 zone continues to remain the immediate resistance band. A close above 54,000 would confirm the base formation and improve the near-term outlook.

Source : Equity Bulls

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