Trade Setup For Nov. 11: Nifty 50 Faces Key Support At 23,800

NSE Nifty 50, which closed lower on Friday, faces key support at 23,800 level, according to analysts. On the upper side, the frontline index faces resistance at 24,700, they said.

"In the immediate term, we expect the index will consolidate in the range of 23,800 to 24,700. A decisive breakout on either side will determine the next direction of the index. Until then, traders should aim to buy near support and sell near resistance," said Hrishikesh Yedve, assistant vice president of technical and derivatives research at Asit C Mehta Investment Interrmediates Ltd.

Technically, on a daily basis, the index formed a red candle, indicating weakness, according to Yedve. "Thus, on the higher side, the index's initial hurdle will be around 24,500, followed by 24,700," he added.

Deepak Jasani, head of retail research at HDFC Securities Ltd., sees the next lower support for Nifty 50 at around 23,800 levels. The immediate resistance is placed at 24,537 levels, he said.

"The street view suggests that the story for Indian stocks is likely to be driven by domestic consumption and investment trends despite a 25-basis-point rate cut by the US Federal Reserve," according to Akshay Chinchalkar, head of research at Axis Securities.

In terms of local equities, a wave of foreign selling and underwhelming second-quarter earnings have led to an 8% decline in the Nifty. However, the medium-term trend remains stable, with the level of 23,800 acting as support on the downside, he said.

Bank Nifty, Yedve observed, has been consolidating around the range of 50,500 to 52,580 over the last few weeks. The index has forming higher lows but unable to cross the barrier of 52,580, he said.

"If the index sustains above 52,580, only then a fresh up move could be possible. Otherwise, the index will continue its consolidation," the analyst added.