The Nifty 50 Index is currently navigating a downward trend in the near term, presenting a critical juncture for traders and investors. As the index approaches the strong support zone at 24,800, market participants should start looking for opportunities to accumulate positions. This level is expected to provide a robust base for a potential rebound, making it an attractive entry point, especially for short-term traders.
Key Support and Resistance Levels
Should the index dip below 24,800, it may enter an oversold zone, extending down to 24,400. These levels represent significant buying opportunities, as a bounce is anticipated once the index reaches these support zones.
On the upside, traders should keep an eye on resistance levels at 25,150, 25,375, and 25,800. After accumulating positions during the dip, booking profits near these resistance levels would be a prudent strategy.
Trading Strategy: Buy on Dips
The best approach for trading the Nifty 50 Index is to adopt a “buy on dips” strategy. The current market conditions suggest a technical bounce is likely to occur soon, enhancing the risk-reward ratio for accumulating positions at lower levels, especially as the market approaches oversold territory.
Nifty Midcap Select Index: Buy on Dips for a Technical Bounce
Similarly, the Nifty Midcap Select Index has faced a sharp correction recently, bringing it close to its key support level of 12,750. This correction offers an excellent opportunity for traders to buy on dips, as a technical bounce is expected once the index reaches this support.
Traders should consider accumulating positions around the current market price (CMP) or slightly below, providing good entry points for short- to medium-term trades. On the upside, the index may encounter resistance at 13,000, 13,075, and 13,150. These levels can serve as profit-taking targets for traders who enter during the dip.
Conclusion
Both the Nifty 50 Index and Nifty Midcap Select Index are positioned for potential rebounds after recent corrections. For the Nifty 50, the key support level of 24,800 presents an enticing buying opportunity, with a potential upside towards 25,800. Likewise, the Nifty Midcap Select Index is nearing its support at 12,750, providing a chance for traders to capitalize on the dip, with resistance targets at 13,150.
In both cases, traders should focus on accumulating positions at the identified support levels and booking profits near the resistance zones. By following a “buy on dips” strategy, investors can effectively navigate these market conditions and optimize their short-term gains.