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Sensex (59932) / Nifty (17610)

The Indian equity market had a bleak start on the day of weekly expiry, taking cues from the SGX Nifty and continued its hustle throughout the day. The benchmark index Nifty50 remained in a slender range at the lower levels, followed by some volatility in the latter half of the weekly expiry session resulting in a muted closure. The Nifty index corrected 0.03 percent from its previous day’s close and settled slightly above the 17600 level.

On the technical front, no sign of respite was seen in the index as it struggled in a tight range. The 200-day SMA is much in the vicinity now and with the ongoing lackluster participation of the bulls, there could be a higher probability of it being tested. As far as levels are concerned, the pivotal support of 17500 remains the key support and any breakthrough could open room for the 200 SMA, which is placed around the 17290-odd level. While on the higher end, until we decisively surpass the 17700-17800 zone, such timidity is likely to continue.

Going forward, we would advocate the participants to keep a close tab on the mentioned levels and avoid undue risk in the market. Even though the indices are not doing much, sector churning is visible in the broader market, and hence one should focus on identifying such potential movers and trade accordingly.

Exhibit 1: Nifty Daily Chart

Nifty Bank Outlook (40669)

Tuesday’s roller coaster ride was followed by yet another sluggish start as BANKNIFTY opened with nearly 500 points cut in the morning. The Adani group woes continue to haunt this space and as a result, we retested 39700 in the initial hour. However, since most of the banking counters have reached the extreme oversold territory and are placed around their crucial intermediate support, we observed strong buying at lower levels. The optimism accelerated in last hour to conclude the session in green, convincingly above the 40600 mark.

It seems that the market has now digested the overall sell off which triggered due to Adani group fiasco. From here on, the fresh round of selling will not happen due to this development. Hence, in case of any stability or any favourable news flow, the banking space would give some recovery in coming sessions. As far as levels are concerned, 40000 followed by 39500 remains to be a sheet anchor; whereas on the flipside, 41000 and then 41500 are the levels to watch out for.

Exhibit 2: Nifty Bank Daily Chart

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