The Indian stock market is poised to open significantly higher on Monday. The Nifty 50 index is expected to reach record levels, driven by positive exit polls from the Lok Sabha elections, strong GDP growth, and favorable global market trends. These factors have created a sense of optimism among investors, indicating a robust start to the trading week.
Gift Nifty Insights
The Gift Nifty trends also suggest a promising start for the Indian benchmark index. Trading around the 23,370 level, the Gift Nifty shows a premium of nearly 660 points compared to the previous close of Nifty futures. This premium indicates strong buying interest and a positive sentiment prevailing in the market.
Recent Market Performance
On Friday, domestic equity indices broke a five-day losing streak, closing with minor gains. The Sensex rose 75.71 points to 73,961.31, while the Nifty 50 climbed 42.05 points, or 0.19%, to settle at 22,530.70. The formation of a long-legged doji on the daily chart for Nifty 50 suggests a potential reversal of the downtrend, signaling a change in investor sentiment.
Technical Analysis
Subash Gangadharan, Senior Technical/Derivative Analyst at HDFC Securities, pointed out that with the Nifty bouncing back from the 50-day Simple Moving Average (SMA), a further rebound is possible in the coming sessions. For the bulls to gain control, Nifty needs to surpass the immediate resistances of 22,654 – 22,706. These levels are crucial for determining the market’s short-term direction. Key support levels to monitor for signs of weakness are 22,465 – 22,396.
Gangadharan also warned that markets are likely to remain volatile as the election result announcement approaches. This volatility can provide both opportunities and risks for investors, making it essential to stay informed and cautious.
Nifty 50 Predictions
On May 31, Nifty 50 exhibited volatility within a narrow range as investors awaited the election results, ending 42 points higher at 22,530. Rupak De, Senior Technical Analyst at LKP Securities, highlighted significant call writing at the 23,000 level and put writing at 22,500. This indicates that Nifty might fluctuate between these levels in the coming days. However, a fall below 22,500 could trigger a correction towards 22,000.
Resistance and Support Levels
According to Santosh Meena, Head of Research at Swastika Investmart Ltd, the immediate resistance zone for Nifty lies between 23,000 and 23,100. Breaking through these levels could pave the way for higher targets at 23,300, 23,500, and eventually 24,000. On the downside, if Nifty falls below 22,400, watch for support levels at 22,200, 22,000, and 21,700. These levels provide crucial insights into the market’s potential movements and help investors make informed decisions.
Bank Nifty Outlook
On Friday, Bank Nifty surged 301 points to close at 48,984, respecting its 20-day Moving Average (DMA). Rupak De noted that Bank Nifty experienced a sharp recovery from its 21-day Exponential Moving Average (EMA), closing near the resistance level of 49,000. The Relative Strength Index (RSI) is making higher lows, indicating a bullish trend. A nifty buy-on-dips strategy is advisable with a stop loss at the 21-day EMA, set at 48,500. Thus, 48,500 serves as strong support, while 49,200 is the first resistance.
Key Levels to Watch
If Bank Nifty breaks above 49,200 on the daily chart, it could soon reach the psychological level of 50,000. This potential rally could provide lucrative opportunities for investors looking to capitalize on short-term market movements. Monitoring these key levels can help investors align their strategies with market trends.
Final Thoughts
As the election results approach, the market is expected to remain volatile. Investors should closely monitor key resistance and support levels to make informed decisions. The positive trends in the Gift Nifty and recent market performance indicate a strong start, but caution is advised due to potential volatility. Consulting certified experts before making any investment moves is always a prudent approach.
Disclaimer:The views and recommendations mentioned above are those of individual analysts or brokerage firms. Investors are encouraged to consult certified professionals before making investment decisions. This advice ensures that investment choices are based on thorough analysis and tailored to individual financial goals.
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