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Sensex (65241) / Nifty (19382)

The Indian equity market tumbled over the global woes and significantly corrected for the consecutive day in the week. Initially, Nifty managed to shrug off the weakened global developments and tried to become stable, but a sell-off got triggered in the latter half, which dragged the index to lower levels. Eventually, by the penultimate hour, we witnessed some recovery from intraday lows which led Nifty to settle a tad below 19400, with a cut of 0.74 percent on the daily time frame.

Though the fall in the last two trading sessions was severe in nature but was mainly because of the external macro factors; hence we should not be apprehensive for the time being. On the technical charts, the benchmark index is hovering near the sacrosanct support of the bullish gap at 19201-19235, which might act as a pitstop for the bears in the near term, before which 19300 might provide some cushioning. While on the flip side, 19500 is likely to be seen as an immediate hurdle (coincides with 20 DEMA), followed by the bearish gap around 19680 in the comparable period.

Nifty Bank Outlook (44513)

Following the negative impact carried over from the previous session, Bank Nifty opened lower and without any valiant effort to bounce back, prices continued to decline for the most part of the session. However, during the final hour, there was a slight rebound similar to the previous session, but it still ended with a percent cut, closing just above 44500.

Bears remain dominant in this week, as prices are breaking intermediate support easily. On the daily chart, prices have closed slightly below a support confluence formed by (i) the Previous Swing Low, (ii) 50 SMA, and (iii) the 61.8% retracement level of the rally seen from the June swing low. This support zone becomes crucial for any potential bullish comeback. However, if breached, prices could decline further, ahead of the significant RBI policy announcement next week. The ongoing global cues continue to exert a major influence, with positive domestic news having limited impact. The market's future trajectory will continue to depend on the developments in global bourses, hence one needs to keep an eye over there. The key levels to watch are the weekly swing high of 44150, followed by the 89EMA at 43900, which could act as support. On the flip side, resistance levels are shifted lower at 45000 – 45200 levels. The volatility is likely to remain on the higher side hence one needs to avoid undue risk.

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