Nifty formed a small red candle on the daily chart on Wednesday with a long lower shadow, technically indicating the formation of a ‘hammer’ type candle pattern. Normally, such hammer formation after a reasonable decline calls for an impending trend reversal on the upside post-confirmation.The short-term trend of the Nifty remains weak. But the smart upside recovery near 23,500 levels is indicating chances of an upside bounce in the coming sessions. A sustainable move above the hurdle of 23,800 levels could confirm an upside bounce in the market. Immediate support is placed at 23,496 levels, said Nagaraj Shetti of HDFC Securities.According to the open interest (OI) data, the highest OI on the call side was observed at 23,800 and 23,700 strike prices, while on the put side, the highest OI was at 23,500 strike price followed by 23,600.What should traders do? Here’s what analysts said:Jatin Gedia, Mirae Asset SharekhanNifty opened on a positive note and witnessed swings in both directions. It closed down 19 points. On the daily charts, we can observe that Nifty has tested the 23,500 – 23,550 support zone and has witnessed a sharp pullback. Until this zone is breached on the downside there is a high probability of a pullback towards 24,000, which coincides with the 20-day moving average. The daily and the hourly momentum indicators have a positive crossover, which is a buy signal. Thus, we are expecting a counter-trend pullback.Rupak De, LKP SecuritiesThe Nifty index is trading within a range of 23,500 to 24,200. In Wednesday's session, it formed a hammer candlestick on the daily chart, closing near its 200-day EMA, thereby strengthening the 23,500 support level. A decisive move will require the index to close below 23,500, which could lead to heightened selling pressure, or sustain above 24,000 to pave the way for a potential rally toward 24,500. Monitoring these crucial levels is essential to identify the next trend in the index.Hardik Matalia, Choice BrokingOn the daily chart, the Nifty index formed a Hammer candlestick pattern with a long lower wick, indicating buying interest from lower levels after a flat opening. This pattern suggests potential bullish momentum, with further upside likely if key resistance levels are breached. However, the index failed to close above the 23,700 mark, signalling caution. On the downside, the 23,500 level remains a critical support zone. A breach below this level could trigger extended selling pressure, pushing the index toward the 23,200–23,000 range. Conversely, on the upside, immediate resistance is seen at 23,800, followed by a significant hurdle at 24,000. A sustained close above these resistance levels would be essential to negate the prevailing bearish sentiment and confirm a bullish reversal.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)