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According to analysts, profit-taking may resume until the index decisively reclaims 22,200.

“We like defence and renewables but they have had a great run. Any correction in markets will bring some of these stock prices to more palatable levels in terms of dipping our toes again. So, there is nothing really I want to be jumping into right now because markets are still looking overbought despite the recent correction.”

Nifty showed the first sign of profit booking when prices slipped below 19,800 level, with a bearish candle on the daily chart. The index has completed the Bearish Crab harmonic pattern at 18,887.60 level.

Analysts said certain technical indicators continue to remain in the overbought territory and the broader market sentiment has not seen any recovery, with only two stocks falling for every one that rose. Some caution is warranted, they said.

Analysts see more upside for the index in the coming days, but a pause cannot be ruled out in the 16,400-16,475 range.

At Wednesdays low of 16,162, Nifty50 slipped into the bullish gap zone at 16,176-146 level registered on August 4, before staging a recovery. Analysts believe the NSE barometer is in for some more consolidation.