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Sensex (66707) / Nifty (19778)

The Nifty benchmark index had a positive start, opening above the previous session's high and witnessing extended buying in the initial hour. Throughout the day, prices traded within a range with a positive undertone, but during the last hour, some profit booking occurred, leading to a closing gain of half a percent at 19778. Following three lackluster days, the Bulls attempted a comeback yesterday; however, there was limited traction, and caution prevailed at higher levels ahead of the FOMC meeting. In the coming session, our markets are expected to be influenced by global markets' movements after the key announcement.

Nonetheless, we anticipate the market to consolidate further before the next significant upward trend. During the monthly expiry session, strong support is observed around 19680 – 19600 and only sustained trading below this level may trigger a cascading sell-off towards the 20EMA positioned around 19500 on the expiry day. On the flip side, 19880 – 19950 remains a stiff resistance, and traders should consider booking profits if these levels are immediately met.

Since it is a monthly expiry session, there might be specific actions related to individual stocks in line with the settlement. Traders can opt for stock-specific actions, but it is essential to be highly selective due to the expected higher volatility.

Nifty Bank Outlook (46062)

The BANKNIFTY started on a sluggish note yesterday but the benchmark index had its intentions clear. Rub off effect of this was seen on BANKNIFTY later on as it started with its catch up move. In fact, in the second half, the banking index clearly outperformed Nifty as we saw steady gains to reclaim 46000 on a closing basis.

The banking space is clearly stuck in a range and it is undergoing a time-correction phase after its recent run. Now, it would be important to see how it behaves around 46150 - 46200 post the FOMC meet. If it manages to sustain above it then we may see a resumption of rally towards 46500 - 46700 levels. As of now, we are seeing some signs of fatigue and hence, any move below 45800 would lead to some extended profit booking in coming days. Today's session may give some clarity of the near term trend for the index.

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