Nifty bounced off twice after testing these levels. Going forward, it would be crucial to watch the previous high within the range and the 11,600 level. Volatility cooled off a bit with INDIA VIX coming off 3.84 percent to 24.2400.
The 11,865 and 11,915 levels on Nifty are likely to act as immediate resistance points in Wednesday’s session, while support will come in at 11,750 and 11,710 levels.
Pattern analysis shows Nifty is back inside the wide trading range between 12,000 and 12,650 levels, which had been created over the past several days. There has been a small gap as well on the upside. However, since the gap has occurred within an area formation, it does not hold any significance from a technical perspective.
Going ahead for here, one needs to watch the 11,930 level, the lower top that Nifty had formed when it was inside the broad area formation. If Nifty manages to move past this mark, then it may test the 12,000 level again. Until then, any bounce should not be chased blindly as the index continued to stay vulnerable to bouts of profit-taking at higher levels. We recommend avoiding fresh purchases and keeping leveraged exposures under control while vigilantly guarding profits at higher levels.