 |
|
The Indian stock market experienced a decline on Thursday, with both the Sensex and Nifty indices closing lower. This downward trend can be attributed to persistent anxieties surrounding the ongoing conflict between Iran and Israel, which has dampened investor sentiment globally. Additionally, the US Federal Reserve's recent decision to maintain interest rates has contributed to the cautious market environment. The combination of geopolitical instability and macroeconomic uncertainty has created a challenging landscape for investors, leading to increased volatility and a general risk-off approach.
Specifically, the Sensex fell by 82.79 points, or 0.10 percent, to settle at 81,361.87. Throughout the trading session, the index exhibited considerable volatility, fluctuating within a range of 392.9 points. It reached an intraday high of 81,583.94 and a low of 81,191.04, highlighting the uncertainty and conflicting forces at play in the market. The broader Nifty index also experienced a decline, slipping below crucial technical levels. Analysts have pointed out that the breach of the 21-day exponential moving average (EMA) and the 24,850 mark represents a significant setback for bullish momentum, suggesting a potential shift towards a more bearish outlook.
According to Rupak De, Senior Technical Analyst at LKP Securities, the Nifty exhibited a lacklustre expiry, remaining confined within a narrow range throughout the session. This indecisiveness signals a period of uncertainty ahead of a potential directional move. De further noted that the index is currently trading below its 200-day moving average (DMA) on the hourly chart and has fallen below the 21-EMA on the daily chart, indicating a weakening of market sentiment. He cautioned that this bearish trend is likely to persist unless the Nifty manages to reclaim the 24,850 level. On the downside, De identified a support level at 24,550, suggesting that the index could potentially decline further if it fails to hold above this level.
Analysts at Bajaj Broking observed that the Nifty formed a high wave candle with shadows on both ends, which is indicative of ongoing consolidation amidst the prevailing geopolitical uncertainty. The index has been trading within a range of 24,400 to 25,200 for the past five weeks, suggesting a period of time-wise correction. The brokerage highlighted the 25,000 level as a key resistance point, noting that a sustained close above this mark could pave the way for further gains towards 25,200. However, failure to cross this level could prolong the sideways movement, indicating that the market may remain range-bound for the foreseeable future. The analysts also cautioned that a fall below 24,700 could intensify selling pressure, with the next support levels located around 24,500–24,400.
Regarding the Bank Nifty, Bajaj Broking observed the formation of a bearish candle with a small upper shadow, reflecting ongoing consolidation within the banking sector. The analysts suggested that a sustained move above 56,000 is necessary to unlock further upside potential towards the 56,600–57,000 range. Conversely, a breakdown below 55,000 could trigger a corrective move towards 54,500–54,000, which represents the 50-day EMA and a key Fibonacci retracement zone. This indicates that the banking sector, like the broader market, is facing significant uncertainty and could experience further volatility in the near term. The analysts advise investors to closely monitor these key levels to gauge the potential direction of the Bank Nifty.
The article concludes with a disclaimer emphasizing that the views and investment tips expressed by the experts are their own and do not necessarily reflect the views of Moneycontrol or its management. Moneycontrol advises users to consult with certified experts before making any investment decisions, highlighting the importance of seeking professional advice and conducting thorough research before engaging in any market activities. The current market conditions are highly volatile and uncertain, making it crucial for investors to exercise caution and make informed decisions based on their individual risk tolerance and investment objectives.
The overall market sentiment appears to be cautious and risk-averse, driven by a combination of geopolitical tensions, macroeconomic uncertainty, and technical factors. The breach of key technical levels in the Nifty and the Bank Nifty suggests a potential shift towards a more bearish outlook, while the consolidation patterns observed in both indices indicate a period of indecisiveness and potential range-bound trading. Investors are advised to closely monitor the key support and resistance levels identified by the analysts and to remain vigilant in the face of ongoing market volatility. It is also important to remember the disclaimer, which highlights the importance of conducting individual research and seeking professional financial advice before making any investment decisions. The market is complex and dynamic and the investment involves risk.
Source: Bears on the prowl as Nifty slips below 21-EMA, breaching 24,850 crucial for bulls, say experts