Market Consolidation Expected As Nifty, Bank Index Respect Support Zones: Analyst
Unless Nifty doesn't cross sub-level 24,350, there won't be any major move or short coverings triggered during the day, said Rajesh Palviya.
Markets could consolidate as both Nifty 50 and Bank Nifty have respected their support zones, according to Kush Bohra, founder of Kushbohra.com. Nifty's support zone is from 24,000 to 24,200, while Bank Nifty has its support zone from 51,800 to 52,200.
There are two key triggers for the market: earnings and budget. Due to the uncertainty surrounding these factors, investors are hesitant to take significant positions on either side. Consequently, the movements in the Nifty and Bank Nifty have been relatively flat.
"Provided the support zones of 24,000 on the Nifty and 51,800 on the Bank Nifty are maintained, we can expect the market to consolidate and move sideways, with a possible mild negative bias. There's nothing to worry about as long as these levels hold," he said.
The Indian benchmark indices recovered some early losses to end little changed on Thursday, as ITC Ltd. and Oil & Natural Gas Corp. stock led gains. Shares of Mahindra & Mahindra Ltd. and Bajaj Finance Ltd. dragged.
The NSE Nifty 50 settled 8.50 points, or 0.04% lower at 24,315.95, and the S&P BSE Sensex closed down 27.43 points, or 0.03% at 79,897.34. During the day, Nifty fell as much as 0.54% to 24,193.75, and Sensex declined 0.58% to 79,464.38.
"For the index, it was a sideways behaviour for the day; the major concentration is based on a 24,300–24,250 strike and all concentrations are 23,000–24,350, a very tight range for the day," said Rajesh Palviya, senior vice president, technical and derivatives research, Axis Securities Ltd.
Unless Nifty doesn't cross sub-level 24,350, there won't be any major moves or short coverings triggered during the day, he said.
"Looking at the data setup, it will be a muted weekly option expiry today; Nifty may remain in the 24,300 to 24,350 range, and we can see an expiry in between. Index-specific trading opportunities are not there at the moment, but stock-specific opportunities are obviously there," he said.
A lot of sectors, from oil and gas to shipping, are showing good traction and a lot of stocks are showing breakouts in the near- and short-term structures, he said.
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