The Indian stock market indices, Sensex and Nifty 50, are anticipated to commence trading lower on Friday following weak global cues. The trends on Gift Nifty also suggest a negative start for the Indian benchmark index, with the Gift Nifty trading around the 22,950 level, a discount of nearly 50 points from the Nifty futures’ previous close.
On Thursday, the domestic equity indices concluded at a record high, with the Nifty 50 finishing above the 22,900 level.
The Sensex surged by 1,196.98 points, or 1.61%, to end at 22,967.65, while the Nifty 50 closed 369.85 points, or 1.64%, higher at 75,418.04.
Nifty 50 formed a long bullish candlestick pattern on the daily charts, indicating strong buying interest.
“The 20-period moving average (MA) remains above the 50-period MA, signifying that the positive MA crossover is still intact. This bodes well for the continuation of the near-term uptrend. On the Daily chart, Nifty continues to stay above the 20-day and 50-day SMA, which is a positive sign. The 14-day RSI at 68.23 is increasing and not in the overbought territory, which is promising,” mentioned Subash Gangadharan, Senior Technical/Derivative Analyst at HDFC Securities.
While we anticipate further upward movements and new all-time highs in the upcoming sessions leading up to the election results, we are also prepared for short-term consolidations, he added.
Here’s what to expect from Nifty 50 and Bank Nifty today:
Nifty OI Data:
Mandar Bhojane, a Research Analyst at Choice Broking, has identified a notable concentration of Open Interest (OI) in Nifty put options at the 22,700 level. This suggests the possibility of potential support at this level. Additionally, on the Call side, significant OI concentrations have been observed at the 23,500 and 24,000 levels.
Nifty 50 Prediction:
The Nifty 50 index surged by 1.64% on May 23, reaching a new record closing high just below the 23,000 level. This breakout above the previous consolidation period indicates a sudden wave of optimism in the market. The index has made significant progress towards the 23,000 mark, coming within 7 points of reaching it. The formation of a large green candle on the daily chart further strengthens the current trend.
Looking ahead, there is potential for the index to move towards 23,500 in the short term if it continues to perform strongly. On the downside, support is expected at 22,800, and as long as the index remains above this level, its strength should remain intact. Rupak De, Senior Technical Analyst at LKP Securities, shared these insights.
To take advantage of this rally, V.L.A. Ambala, Co-founder of Stock Market Today (SMT), advised investors to stay invested, hedge their positions, and diversify their portfolios. The market is gearing up for a potential upside trend, as indicated by the shift in Nifty’s short-term support to 22,500. Furthermore, this rally is expected to be driven by movements in midcap and smallcap stocks.
Considering these factors, Ambala believes that Nifty could find support between 22,850 and 22,770, while facing resistance between 23,340 and 23,150.
Bank Nifty Prediction:
On Thursday, the Bank Nifty index experienced a significant surge, gaining 987 points or 2.06%. This propelled the index to close at 48,769. After a period of consolidation, the bulls in the Bank Nifty market were able to push the index to new heights. This surge has instilled a sense of renewed optimism, as the index surpassed the 48,500 mark. Looking ahead, there is a possibility of further upward momentum, with the index potentially moving towards 49,500 in the near future, as long as the support at 48,500 remains strong. According to De, an immediate resistance level for the Bank Nifty is positioned at 49,000.