Pre-Market Commentary: buying demand is seen emerging in Nifty from the key support area of 23,800–23,600

AHMEDABAD, 7 SEPTEMBER: The index on the daily chart formed a sizable bearish candle with a higher high and higher low. Nifty opened higher above 24,000 levels but failed to sustain at higher levels as it reacted sharply lower from the previous breakdown area of 24,025 and gave up its gains to close at the low of the day near 23,900 levels.  The daily stochastic has approached oversold territory, and buying demand is seen emerging in Nifty from the key support area of 23,800–23,600. Hence, index holding above the key support area of 23,800-23,600 will lead to a pullback towards the 50-day EMA placed around 24,150 cannot be ruled out in coming sessions. However, the overall bias remains corrective below the last week’s high, and the 50-day EMA placed around 24,150 levels. Only a move above the same will signal a pause in the downtrend and will open a pullback towards 24,300–24,350 levels in the coming sessions.

From a short-term perspective, only a move above the recent swing highs placed around 24,380 will signal resumption of positive momentum. Key short-term support is placed at 23,800–23,600 levels, being the confluence of the previous major gap area and the low of July 2026.

 BANK NIFTY: the key short-term support area of 56,500-56,200 levels

Bank Nifty formed a second small bearish candle as it continues to consolidate in a range around the 50 days EMA. Index in the immediate short term is seen trading in the range of 57,000-58,000 levels. A close below 57,000 will signal extension of decline towards the key short-term support area of 56,500-56,200 levels being the confluence of the 52 weeks EMA and the lower band of the last 9 weeks range.

Overall, the broader 9 weeks consolidation range remains intact between 56,500 and 58,700. We expect the index to extend the current consolidation and only a breakout or breakdown will signal a directional momentum.

Within the consolidation index is facing resistance around 58,000 levels. Index sustaining above 58,000 levels will open upside towards 58,500-58.700 levels. Failure to sustain above 58,000 levels will signal extension of range bound trade in the range 57,000-58,000 levels in the coming sessions.

Report by: Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking

(Disclaimer: The information provided here is investment advice only. Investing in the markets is subject to risks and please consult your advisor before investing)

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