The stock market benchmark Nifty 50 extended losses for the second consecutive session on Wednesday, 21 October, amid elevated oil prices and escalating tensions between the US and Iran.
The index closed 0.34% lower at 22,811, inching closer to a key support at 22,800. As oil prices remain above $110 per barrel, market sentiment remains cautious, and a rally could be met with profit-taking.
As per Amol Athawale, VP - Technical Research, Kotak Neo, on the daily chart, the Nifty formed a bearish candle, while the intraday lower-top pattern indicates a broadly negative setup.
"For day traders, the 20-day SMA (simple moving average), together with 22,800 and 22,750, would serve as important support zones. As long as the market remains above these levels, it could recover toward 22,950-23,000," said Athawale.
"On the other hand, selling pressure is likely to increase below 22,750, potentially taking the market toward 22,600-22,550. Considering the prevailing volatility, level-based trading would be the preferred approach for day traders," Athawale said.