The Indian stock market benchmark indices, Sensex and Nifty 50, are likely to open lower on Friday tracking a sharp weakness in global peers.
The trends on Gift Nifty also indicate a gap-down start for the Indian benchmark index. The Gift Nifty was trading around 24,850 level, a discount of nearly 185 points from the Nifty futures’ previous close.
On Thursday, the domestic equity market ended at fresh closing highs, with the Nifty 50 settling above the 25,000 level.
The Sensex rose 126.21 points to close at 81,867.55, while the Nifty 50 settled 59.75 points, or 0.24%, higher at 25,010.90.
Nifty 50 formed a small negative candle on the daily chart with minor upper and lower shadow.
“Technically, this pattern indicates a doji type formation, not a classical one. The current market action signals continuation of range bound action in the market. The crucial hurdle of 25,000 – 25,100 levels remains intact and the Nifty was not able to break above this area decisively,” said Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities.
He believes the chances of further consolidation or minor dip are not ruled out in the short term.
Here’s what to expect from Nifty 50 and Bank Nifty today:
Nifty OI Data
Analysing the Nifty Open Interest (OI) data, Mandar Bhojane, Research Analyst, Choice Broking said that the highest OI on the call side was at 25,200 and 25,500 strike prices, while on the put side, it was concentrated at the 24,500 strike price.
“The overall trend remains sideways to bullish, with expectations of continued high volatility. Investors are advised to maintain positions with a trailing stop-loss strategy,” said Bhojane.
Nifty 50 Prediction
Nifty 50 continued its range bound movement with a positive bias on August 1 and closed the day higher by 59 points above the 25,000-mark.
“The Nifty remained range-bound during the day before closing above 25,000 for the first time. The sentiment remains positive as it closed above the short-term moving average. The RSI is in a bullish crossover while entering the overbought zone, indicating the possibility of profit booking,” said Rupak De, Senior Technical Analyst, LKP Securities.
According to him, on the lower end, support is placed at 24,900 and on the higher end, resistance is placed at 25,100 – 25,250.
VLA Ambala, Co-Founder of Stock Market Today notes that currently, the Nifty 50 index is trading in an overbought condition, as seen from its RSI readings that are above 75 on daily, weekly, and monthly timeframes.
“This overvaluation, combined with price deviations from the 20-day and 50-day EMA (Exponential Moving Average), suggests potential volatility. For traders tapping into this market, a neutral stance would be ideal. Notably, the major trend continues to be bullish but we can expect a pullback soon. In such conditions, using Long Straddle strategies can help manage market fluctuations,” Ambala said.
She expects Nifty support levels at around 24,940 and 24,860, and resistance around 25,085 and 25,130 in the next session.
Bank Nifty Prediction
Bank Nifty index ended with minor gains of 11 points at 51,564 on Thursday, indicating sluggishness overall in the last 2-3 sessions.
“Bank Nifty has been sluggish since the last 3-4 sessions hovering near the 51,600 zone for quite some time and would need a decisive breach above the 52,000 zone to improve the bias and further strength shall be confirmed once a breakout above 52,800 level is confirmed,” said Vaishali Parekh, Vice President – Technical Research at Prabhudas Lilladher Pvt. Ltd.
According to her, Bank Nifty would have the daily range of 51,200 – 52,000 levels.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
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