The Indian markets are expected to open lower amid mixed global trends as investors continue to monitor geopolitical developments around US-Iran peace talks. GIFT Nifty also indicates a gap-down start, trading at 23,997 with a discount of 82 points from its previous Nifty futures close.
On Tuesday, the Sensex declined 479.26 points or 0.63% to close at 76,009.70, while the Nifty 50 fell 118 points or 0.49% to settle at 23,913.70.
Meanwhile, the Indian rupee opened lower at Rs. 95.74 per dollar on Wednesday versus previous close of Rs. 95.68.
Foreign institutional investors (FIIs) net sold shares worth Rs. 2,408 crore, while domestic institutional investors (DIIs) net bought shares worth Rs. 1,361 crore on May 26.
Technically, the Sensex witnessed profit booking at higher levels, indicating cautious traders sentiment.
The 75,900 and 75,800 would act as crucial support zones for day traders. As long as the market is trading above these levels, the uptrend remains intact. On the higher side, 76,600 could be the immediate resistance zone for the bulls. A dismissal of this level could push the market up to 76,900-77,100. On the flip side, a break below 75,800 could lead the market to slip towards 75,300-75,000. The intraday market texture is non-directional and level-based trading would be the ideal strategy," said Shrikant Chouhan, Head of Equity Research at Kotak Securities.
On the monthly expiry day, the Nifty 50 shed its initial weakness and moved higher in early trade, hitting an intraday high of 24,090. However, profit booking at higher levels dragged the index lower towards 23,914.
“On the daily chart, Nifty formed a small-bodied bearish candle with a noticeable upper wick, indicating profit booking at higher levels. After managing to close above its 50-day EMA in the previous session, the index failed to sustain above the same and slipped back below it. The RSI also witnessed a downtick after yesterday’s breakout, suggesting a pause in momentum,” said Sudeep Shah, Head - Technical and Derivatives Research at SBI Securities.
Going ahead, the immediate resistance is placed in the 24,050-24,100 zone. Any sustainable move above this zone could result in Nifty extending its pullback towards 24,250, followed by 24,400 in the short term. On the downside, the immediate support for Nifty is placed in the 23,800-23,750 zone.
Bank Nifty index fell 200.75 points or 0.36% to close at 55,092.90, forming a small candle on the daily chart, indicating some profit booking after the sharp two-day rally.
According to Bajaj Broking Research, "Index sustaining above the Monday's gap area (54,055-54,590) will keep the bias positive and will open further upside towards 56,000 and 56,600 levels in the coming sessions being the measuring implication of the recent consolidation range."
The brokerage said Bank Nifty has immediate support near 54,000, while major short-term support is placed in the 53,000-52,500 zone.
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