Indian benchmark indices, Sensex and Nifty 50, are likely to open higher today, January 14, amid positive trends observed in global counterparts and a gap-up indication seen in Gift Nifty. Gift Nifty is trading around 23,280 levels, that is about 118 points higher than the last close of Nifty futures.
Market Recap and Technical Insights
Domestic equity markets had a much-needed correction in Monday. At the close on Monday, it dropped 1,048.90 points or 1.36 percent to trade at 76,330.01. And Nifty50 ended 345.55 points lower, down 1.47 per cent at 23,085.95.
The Nifty 50 had formed a bearish candle with an opening gap-down and long upper shadow. "This is a decisive downside breakout from the symmetrical triangle pattern, suggesting the market's continued weakness. So, a fall towards 22,800 - 22,700 may be witnessed, and 23,260 level was also broken. Pull back towards 23,350 can sell the counter," observed Nagaraj Shetti, Senior Technical Research Analyst, HDFC Securities.
Nifty 50 Predictions
Rupak De, senior technical analyst at LKP Securities, believes the bearish pressure on Nifty 50 was still prevalent on January 13 as the index closed below significant levels. While the index remains above the crucial 23,000 level, it can be interpreted as a sign of recovery if the sustained levels are seen above this mark. A clear fall below 23,000 would lead to a steeper correction.
VLA Ambala, Co-Founder of Stock Market Today, noted that the Nifty 50 and Sensex both closed below their 50-day exponential moving averages. This will see more selling pressure. She also pointed out that the index is just 3% away from its critical 20-month EMA, which is a significant support zone. She expects support to be seen between 22,950 and 22,800 while resistance would be seen around 23,050 to 23,100 in today's session.
Bank Nifty Outlook
Bank Nifty also plunged sharply on Monday, down 692.90 points (1.42%) to close at 48,041.25. The index formed a bearish candlestick pattern and stayed below the 250-day simple moving average (250-DSMA) near 49,900, which indicates weakness.
Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Intermediates Ltd, said, "As long as Bank Nifty stays below 49,900, a sell-on-rise strategy is advised. Key support on the downside is seen around 47,300, near the 100-week EMA.
Conclusion
The market is likely to open higher today, but caution is advisable since the market has corrected sharply and is now testing some very important technical levels. Traders should watch these support and resistance zones closely.
Disclaimer:
Views and recommendations as mentioned above are those of individual analysts and broking companies. The investors are requested to consult with certified experts before making any investment decisions.
