Nifty's closing below 22,900 on October 19, markets are tilting towards the bearish side, said analysts.
Nifty snapped its two-session winning streak as profit booking dragged the index down 257 points to close at 22,888. After opening marginally higher by 4 points, the index briefly surpassed Friday’s high but failed to sustain the gains. It subsequently slumped 330 points from its intraday peak to finish near the day’s low.
"With earnings of most banks largely in line with, or ahead of, expectations, barring Axis Bank, the selloff looked disproportionate and reflected profit-taking after last week's sharp rally," said Siddhartha Khemka, head of research, wealth management at Motilal Oswal Financial Services.
"The correction has brought Nifty close to its key support at 22,800, where the 20-day SMA coincides with the previous swing high. The bullish setup in indicators and oscillators remains intact, and the latest decline does not, by itself, signal a trend reversal. Nifty could find support around 22,800 and resume its uptrend. However, a decisive break below the positional support at 22,500 would weaken the bullish outlook and warrant caution," said Vinay Rajani, Senior Technical Research Analyst, HDFC Securities.
"Immediate support is placed at 22,650–22,700, while resistance is seen around 23,150–23,200. The PCR stands at 0.88, indicating a relatively cautious options-market setup, while India VIX rose 5.33% to 14.7725, reflecting increased volatility and uncertainty," said Hitesh Tailor, Technical Research Analyst at Choice Broking Private Limited.