Indian stock markets are likely to remain under pressure on Thursday, August 20, after the benchmark indices, Sensex and Nifty, extended their losing streak on Wednesday amid persistent selling pressure due to elevated crude oil prices and a lack of a diplomatic resolution following the end of the US-Iran ceasefire, which dented investor sentiment.
Falling for the fourth consecutive day on Wednesday, the 30-share BSE Sensex dropped by 325.78 points, or 0.42 per cent, to settle at 76,909.68. In the last four days, the benchmark has lost 1,170.28 points, or 1.49 per cent.
Extending its losses to the seventh day, the 50-share NSE Nifty declined 76.60 points, or 0.32 per cent, to end at 24,078.30. It has tumbled 505.5 points, or 2 per cent, in the last seven sessions.
Stock Market Prediction Today, August 20 by experts
According to market experts, the Nifty is likely to remain in a broad consolidation range, while the Sensex might see more weakness if it fails to hold its immediate support zone.
Sensex Prediction for Thursday, August 20
Noting that the benchmark closed close to the day’s lower levels, indicating persistent selling pressure and a lack of strong buying interest during the session, he said price action continues to reflect weakness as the Sensex slipped below the crucial 77,000 mark and failed to stage a meaningful recovery.
“The immediate support zone is placed at 76,500–76,750, while 77,270–77,400 is likely to act as the first resistance band. The broader trading range stands at 76,500–77,400, keeping the near-term bias sideways,” he said.
Gupta further stated that a sustained hold above support could trigger a technical rebound, whereas a decisive breakdown may open the door for further weakness.
From a technical perspective, Gupta stated the Sensex has closed lower for three consecutive trading sessions, highlighting persistent bearish pressure.
“Today’s session formed another bearish candle, with the index closing below the crucial 77,000 level and remaining below all key moving averages visible on the daily chart. Momentum has also weakened significantly, with the RSI at 41.78, well below its RSI moving average of around 55.34, indicating increasing bearish momentum.
Meanwhile, the PCR at 0.88 reflects cautious market positioning and further reinforces the near-term negative bias, he added.
Gupta said the broader outlook remains sideways with a cautious-to-bearish bias, as the index needs to reclaim the 77,270–77,400 resistance zone to regain stability and improve the near-term setup.
“On the downside, holding the 76,500–76,750 support band will be crucial to contain further weakness. A decisive break below this zone could extend the ongoing corrective phase. For now, traders are likely to remain cautious, with any recovery towards the resistance zone requiring confirmation through stronger price action and improving momentum indicator,” the analyst concluded.
Nifty Prediction for Thursday, August 20
The Indian benchmark indices extended their losing streak for the seventh consecutive session, according to Bajaj Broking Research, as persistent geopolitical tensions continuing to weigh on investor sentiment. Besides, Brent crude oil prices sustaining above the $90 per barrel mark remained another key overhang, raising concerns over inflationary pressures and corporate profitability and keeping investors cautious.
The brokerage expects the Nifty to extend its recent consolidation and trade in the broad range of 24,000-24,600 in the coming sessions.
The brokerage noted that the index has formed a third consecutive bearish candle which maintained lower high and a lower low highlighting continuation of the corrective bias.
“As mentioned in earlier edition, index is forming lower high and lower low in the last 9 sessions, index need to break the sequence and start forming higher high and higher low in the daily chart on a consistent basis to signal pause in the current corrective trend,” it added.
According to the brokerage, the index in the last 12 sessions is seen consolidating in a range with a corrective bias, while retracing 61.8% of its previous 7 sessions sharp up move from 23,606 to 24,774.
“A shallow retracement of its previous up move highlights a higher base formation. The daily stochastic has approached oversold territory with a reading of 10, hence a pullback in the coming sessions cannot be ruled out,” Bajaj Broking Research said.
Nifty has short-term support placed at 24,000-23,800 levels being the confluence of the trendline support joining last 4 months lows, previous major gap area and 61.8% retracement of previous up move 23,606 to 24,774, it concluded.
Hitesh Tailor, Technical Research Analyst at Choice Broking, said the daily chart indicates continued weakness as the index is trading below the 50-Day EMA, while the RSI has also slipped below the 50 mark.
Immediate support is placed at 24,000–24,030, while resistance is seen at 24,180–24,270; sustaining above the resistance zone would be important for a meaningful recovery, said Tailor.
From a technical perspective, Tailor said RSI stands at 42.22 against its RSI average of 56.05, indicating that momentum has weakened and buying strength remains subdued.
“The index is also trading around the 50% Fibonacci retracement level of 24,190, which has emerged as an important hurdle on the upside. Hence, 24,000 remains the immediate critical make-or-break level; holding this zone can help the index build a base and attempt a recovery, while a decisive break below it could increase selling pressure and drag the index towards 23,900,” the analyst said.
On the downside, 24,030 remains the immediate support, followed by 24,000 and 23,900. On the upside, 24,100 is the immediate hurdle, while 24,186, coinciding with the 50-Day EMA, remains a key resistance level, followed by 24,270. A sustained move above these levels would improve the technical structure and could signal a recovery towards higher levels, he added.
(Disclaimer: The above article is meant for informational purposes only and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money-related decisions.)
