The Nifty, a prominent stock market index in India, experienced a downward trend on Monday for the fourth consecutive session. This decline led to the formation of a bearish candle on the daily chart, characterized by a long lower wick, indicating some buying activity at lower levels. For three consecutive sessions, the index displayed lower high-lows, signaling a potential shift in market sentiment. The 50-pack index also dipped below its 21-day exponential moving average (EMA), suggesting a weakening sentiment among investors.
Expert Insights and Analysis
According to Rupak De, a Senior Technical Analyst at LKP Securities, the downtrend in the Nifty continued as the index kept falling post a lower high on the daily chart. The sentiment further deteriorated as the Nifty slipped below the 21EMA, accompanied by a bearish crossover in the Relative Strength Index (RSI). De anticipates a continuation of this trend in the short term, predicting a potential drop below 23,350 with further downside potential to the 23,000 level. On the upside, he sees resistance at 23,550 for the Nifty.
Offering another perspective, Osho Krishnan, a Senior Analyst at Angel One, highlighted that the balance between advances and declines favored the bears, with a bullish gap on the daily chart being filled as the Nifty closed below the 20-day EMA after seven sessions. A negative crossover in the RSI further added to the bearish sentiment.
Krishnan emphasized the technical aspect of the situation, noting that the Nifty reverted to a consolidation phase, creating uncertainty among market participants. He identified the 23,300-23,200 zone as a critical support level, with a potential break below this range pushing prices towards the psychological barrier of 23,000. Krishnan also pointed out that the 23,500-23,700 range acts as a significant hurdle, coinciding with the upper band of the ‘Falling Wedge’ pattern. A decisive breakout in this zone could trigger a buying spree in the market.
Market Analysis and Predictions
Ajit Mishra from Religare Broking echoed similar sentiments, highlighting 23,200 as a vital support level for the Nifty. A breach below this level could strengthen the bearish sentiment, potentially leading the index towards its January low of 22,800. Chandan Taparia of MOFSL provided insights on the Sensex, noting a bearish candle formation with a significant lower shadow, indicating buying interest at lower levels despite selling pressure at higher zones. Taparia suggested that the Sensex must surpass and sustain above 77,500 to move towards 77,800 and 78,000 levels. Support levels were identified at 77,000 and 76,800 zones.
In conclusion, the recent performance of the Nifty and Sensex indices has sparked concerns among investors and analysts alike, with technical indicators pointing towards a further downtrend. As market participants closely monitor key support and resistance levels, expert opinions vary on the potential trajectory of these indices in the coming days.
Disclaimer: The stock market news provided by Business Today is intended for informational purposes only and should not be considered as investment advice. It is advisable for readers to seek guidance from a qualified financial advisor before making any investment decisions.
