The Indian stock market benchmark indices, Sensex and Nifty 50, are likely to extend losses and open lower on Tuesday, amid cautiousness over the rising crude oil prices and its impact on the domestic economy.
The trends on Gift Nifty also indicate a gap-down start for the Indian benchmark index. The Gift Nifty was trading around 23,646 level, a discount of nearly 222 points from the Nifty futures’ previous close.
On Monday, the Indian stock market extended losses for the third consecutive session and ended sharply lower, with the Nifty 50 slipping below 23,900 level.
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The Indian stock market benchmarks, Sensex and Nifty 50, are expected to open lower today. This is indicated by the Gift Nifty trading at a discount and reflects cautiousness over rising crude oil prices and the US-Iran war.
The Sensex and Nifty 50 closed lower on Monday due to a sharp sell-off across the Indian stock market. Factors contributing to this decline included rising crude oil prices, a fragile US-Iran ceasefire, and a potential slowdown in discretionary spending following government austerity appeals.
Immediate support for the Nifty 50 is seen at 23,800 levels. On the upside, resistance is observed at 24,000 levels, with a move above this potentially leading to a pullback towards 24,200.
Rising crude oil prices are contributing to caution in the Indian stock market. This is due to concerns about their impact on the domestic economy and potential supply issues, especially amid ongoing geopolitical tensions in the Middle East.
Bank Nifty is expected to face continued decline, trading below key moving averages. Immediate support is seen around 54,100-54,000, with a breach below this potentially dragging the index lower. Resistance is expected in the 54,900-55,000 zone.
The Sensex crashed 1,312.91 points, or 1.70%, to close at 76,015.28, while the Nifty 50 settled 360.30 points, or 1.49%, lower at 23,815.85.
Here’s what to expect from Sensex, Nifty 50 and Bank Nifty today:
Sensex Prediction
Sensex closed below the 76,500 level, which is the 50-day SMA (Simple Moving Average) support zone, and formed a bearish candle on the daily charts, which is largely negative.
“We are of the view that as long as Sensex is trading below the 50-day SMA (or 76,500), a weak formation is likely to continue. On the downside, the correction could extend till 75,500 – 75,300. On the flip side, a move above 76,200 could lead to a technical pullback up to 76,400 – 76,500,” said Shrikant Chouhan, Head Equity Research, Kotak Securities.
Nifty Options Data
In the derivatives segment, significant call writing was observed at the 23,900 and 24,000 strikes, while put writing was concentrated at the 23,800 and 23,600 levels, suggesting a broader trading range with a cautious to bearish bias.
Nifty 50 Prediction
Nifty 50 index formed a strong bearish candlestick pattern on the daily timeframe, indicating sustained selling pressure across the session.
“A long bear candle was formed on the daily chart with a gap down opening. Nifty 50 is now placed at the lower end of a broader high low range of 23,800 – 24,500 levels. Any bounce back from near the support of 23,800 could open further upside in the near term,” said Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities.
According to him, any decisive breakdown of the support could possibly drag Nifty 50 down to next support of 23,500 / 23,200 levels in the near term.
Nilesh Jain, VP- Head of Technical and Derivative research at Centrum Finverse noted that the Nifty 50 index formed a large bearish candle on the daily chart and also witnessed a breakdown below its rising trend line support, indicating weakness in the short-term structure.
“Immediate support is now seen at 23,800 levels, and a breach below this may drag the Nifty 50 index towards 23,550 in the near term. On the upside, a move above 24,000 could trigger short covering and lead to a pullback towards 24,200 levels. The momentum indicators have turned negative as the MACD has generated a fresh bearish crossover, while the RSI has slipped below the 50 mark, reflecting weakening strength,” said Jain.
On the volatility front, India VIX jumped nearly 10% to close around 18.50 levels, and any sustained move above the 20 mark could further increase nervousness among market participants, he added.
Bank Nifty Prediction
Bank Nifty index ended 870.65 points, or 1.57%, lower at 54,439.90 on Monday, forming a bearish candlestick pattern with a lower high and a lower low, signaling extension of the decline for the second session in a row.
“The Bank Nifty index is trading below its key moving averages, which are gradually sloping downward, reflecting a weakening trend. The daily RSI stands at 43.74 and continues to trend lower, suggesting fading momentum. Going ahead, the zone of 54,100 – 54,000 is likely to act as immediate support for the index. A decisive and sustained breach below 54,000 could trigger further downside, potentially dragging the index towards the 53,400 level,” said Sudeep Shah, Head – Technical and Derivatives Research at SBI Securities.
On the upside, he expects the 54,900 – 55,000 zone to act as a strong resistance, and a breakout above this range would be crucial for any meaningful recovery.
Bajaj Broking Research highlighted that the Bank Nifty index is currently placed around the lower band of the last 3 weeks range 54,000 – 56,500, and a breakdown below the same will open further downside towards 52,500 levels in the coming sessions.
“While holding above 54,000 on a closing basis will signal extension of the recent consolidation. On the higher immediate resistance is placed at Monday’s gap down area of 55,000 – 55,065. Bank Nifty index sustaining below the same will keep the bias down,” said the brokerage firm.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
