Indian share market is likely to start Tuesday's session on a mildly optimistic note, as reflected in Gift Nifty's trends that were trading at the 24,800 level—about 25 points higher than the previous closing of the Nifty futures. This indicates a mildly positive bias, but there is mixed cues from the broader market.
Recap: Market Performance on May 20
The local markets closed lower for the third consecutive session. The Sensex fell 872.98 points (1.06%) to close at 81,186.44, while the Nifty 50 fell 261.55 points (1.05%) to close at 24,683.90. Both the indices also created strong bearish candles on their corresponding daily charts, indicating chronic profit-booking and deteriorating sentiment.
Sensex Outlook
Analysts are of the opinion that as long as Sensex stays below 81,700, the correction process will continue. The support points on the downside are visible at 80,800 and 80,500. If, however, the index is able to break above the 81,700 mark, it may lead to a short-term rally with possible upside targets of 82,200 and 82,500, as suggested by Shrikant Chouhan of Kotak Securities.
Nifty 50 View
The Nifty 50 too exhibited weakness in line with the bearish momentum from recent sessions. It now trades just above its 38.2% Fibonacci retracement level of 24,665, with important support at 24,500 (50% retracement). Sustained decline below 24,500 might take the index to 24,200. To the upside, any bounce might meet resistance between 24,750 and 24,810. Om Mehra of SAMCO noted that the RSI is trending downward, currently at just below 60, reinforcing the cautious technical perspective.
Dr. Praveen Dwarakanath of Hedged.in also stressed that 24,500–24,700 is a key support level, and a breakdown would be bearish, but the zone is now demonstrating strength. He further said that momentum indicators continue to reflect underlying bullishness on higher time frames, and falls at this juncture may offer buying opportunities—given Nifty holds above 24,500.
VLA Ambala, a Co-Founder of Stock Market Today, also shared this perception and indicated that support could be between 24,420 and 24,500, while the index might experience some resistance near 24,750 to 24,810 levels in today's trading session.
Bank Nifty Forecast
Bank Nifty index ended 543.35 points lower at 54,877.35, developing a bear candle with lower high and lower low pattern, indicating further profit-booking at higher levels. According to Asit C. Mehta's Hrishikesh Yedve, as long as the index stays below 55,290, weakness is on the cards. Support is seen around 54,460, near the 21-day EMA. The traders are recommended to stick to a sell-on-rise approach until a decisive break above the 55,290 level.
On the other hand, Bajaj Broking Research observed that Bank Nifty has been ranging broadly between 53,500 and 56,000 for the past four weeks. Despite weakening, the index has retraced just 38.2% of its earlier 9-session rally, meaning it is a shallow pullback and can be a higher bottom formation. The brokerage advises picking up dips as opportunities to buy, especially around the support level of 53,000 to 53,500, which coincides with key technical retracements and 50-day EMA.
Volatility and Strategy
India VIX is at 17.39 at present. A surge past 18 may introduce increased market volatility and bigger intraday oscillations. Technical levels indicate that until a robust base is established, it might be premature to enter aggressive long positions. At present, a watchful and selective strategy with awareness of principal support areas and indications of price stability is preferable.
Disclaimer: The opinions and projections presented above are derived from market analysts and brokerage firms. Investors are requested to meet with certified financial advisors prior to making investments.
