The Indian stock market will open cautiously on Wednesday, April 2, as benchmark indices Sensex and Nifty 50 are expected to open flat amid divergent global cues and investor worries over US President Donald Trump's upcoming reciprocal tariff announcement.
Market Recap: Tuesday's Sharp Decline
On Tuesday, the local equity markets saw a sharp drop, with Sensex and Nifty 50 declining more than 1.5% each. The Sensex fell 1,390.41 points (-1.80%) to close at 76,024.51, while the Nifty 50 closed 353.65 points down (-1.50%) at 23,165.70. The selling was caused by negative global sentiments, profit booking, and fears related to geopolitical and economic events.
Sensex Outlook for April 2
Technical indicators indicate a bearish momentum continuation for the Sensex. A long bearish candle on the daily charts shows selling pressure, and the major support is at 75,800. Shrikant Chouhan, Head of Equity Research at Kotak Securities, says that a bounce-back can happen if Sensex holds above this level, with resistance likely between 76,500 and 76,650. But a dip below 75,800 could speed up selling pressure, pushing the index toward the 50-day Simple Moving Average (SMA) of 75,500 - 75,300.
Nifty 50 Analysis: Key Support at 23,000
Nifty 50 also showed bearish trends, creating a long upper-shadow candle on the daily chart, indicating selling pressure at higher levels. Despite this, analysts opine that the broader uptrend is intact.
Nagaraj Shetti, HDFC Securities Senior Technical Research Analyst, pointed out that the recent fall is part of a healthy correction, which could result in a higher bottom formation. He anticipates support at around 23,000, whereas resistance is at 23,400.
Technical Analyst Om Mehra of SAMCO Securities noted that even though Nifty 50 dipped below the 9-day Exponential Moving Average (EMA), it is still trading above the 50- and 100-day EMAs, which means the long-term trend remains intact. Mehra identifies short-term support at 23,000 and an additional cushion of fall around 22,850. The resistance is expected around 23,450.
Bank Nifty: Important Levels to Monitor
Bank Nifty closed Tuesday's trading 1.43% down at 50,827.50, a bearish candle. The index is close to a break below its 9-EMA but is still trading above its 50- and 100-EMAs, which means that the overall trend is still slightly intact.
The next key support is at 50,390, which is also the 38.2% Fibonacci retracement level. Resistance is on the higher side at 51,400. Trump's tariff announcement is due, and one can expect wider movements as well as high volatility in the banking index.
Expert Views and Investment Strategy
VLA Ambala, Co-Founder of Stock Market Today, emphasized that Nifty 50’s resistance zone lies between 23,400 and 23,800, where a sell-on-rise strategy may be beneficial for traders. She also recommended that investors with a short-term outlook should adjust their strategies, as market momentum is expected to slow down compared to previous years.
Ambala is of the opinion that this phase offers the chance for intelligent investors to build a diversified portfolio. Technical levels signify that Nifty 50 may discover good support between 22,900 and 22,810, with resistance at around 23,250 and 23,410.
Market Outlook: Volatility Ahead
With worldwide market unpredictability and anticipation of Trump's trade policies, volatility is bound to continue. Traders can keep an eye on major support and resistance points while watching international cues for more guidance.
Disclaimer: The suggestions and views cited in this piece are those of analysts and broking houses. Investors are cautioned to seek guidance from certified professionals before making an investment decision.
