There is plenty to track as the market approaches the June F&O series starting on Wednesday for the NSE contracts and on Friday for the BSE contracts.
The bulls would not be pleased with the fact that 24,000 came and lasted only for a day. Despite the index managing to hold on to 23,900 on the downside in what otherwise was a rangebound trading session, it ended near the lows of the day.
The global situation remains very fluid or shall we say “in the air”. Nothing concrete can be ascertained until everything is put on paper. Till then, it remains a headline driven market. When headlines are positive, the markets react to them, and vice versa.
Another important factor to keep an eye on will be the RBI policy in the first week of June. A lot will depend on the Monetary Policy Committee’s stance and of course the interest rate decision, along with remarks from Governor Sanjay Malhotra on the road ahead for the Indian economy in these testing times.
On the downside, 23,800 remains the most important level to watch for the Nifty going into Wednesday’s trading session, which also happens to be the monthly expiry for the BSE contracts. On the upside, Tuesday’s high of 24,088 will be the first hurdle to cross for the bulls.
The only solace, if any, could be the fact that the India VIX ended lower, even after the market declined, but that also saw some recovery from the lows, to end with losses of around 3% compared to the initial drop of close to 6%.
With earnings season drawing to a close, the final few result reactions on Wednesday come from companies like ONGC, IRCTC, AstraZeneca, FirstCry, Camlin Fine, JK Tyre, Landmark Cars, and other such names.
Axiscades, Bajel Projects, Bata, Mrs. Bector Foods, Cello World, Gillette India, Kesoram Industries, MM Forgings, PG Electroplast, PC Jeweller, TVS Srichakra, Varroc Engineering, are some of the companies that will be reporting their results on Wednesday.
Key Levels To Watch
Rupak De of LKP Securities said that the hourly RSI on the Nifty remains in a bearish crossover and is drifting lower as well, suggesting some near-term weakness. However, he does not rule out the possibility of a rebound in the upcoming sessions, with 24,200 acting as a hurdle and a sustained upmove above that could trigger further upside. A break below 23,900 on the downside can take the index back to 23,825 levels.
“Going ahead, the immediate resistance for Nifty 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,” said Sudeep Shah of SBI Securities.
The Nifty Bank was the key contributor in the Nifty exhibiting sluggish moves on expiry day, but unlike the Nifty, the banking index continued to trade in a broad range. Despite a 500-point fall from the day’s high, the index managed to hold on to the 55,000 mark on a closing basis, something the bulls could take heart from. Tuesday’s high of 55,536 will be the first level to watch on the upside.
“On the daily chart, Nifty Bank continues to trade below the falling trendline resistance while holding above the hourly Supertrend support placed near 54,700, which continues to act as a key short-term base. On the upside, 55,500–55,800 remains the immediate resistance zone. On the downside, 54,600 remains the immediate support level, followed by 54,300. A buy-on-dips strategy may continue to remain favourable as long as 53,600 is defended on a closing basis,” Om Mehra of SAMCO Securities said.
