Nifty remains undecided even as D-Street continues to set records; check support, resistance levels

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Indian stock exchanges continued to follow the optimism of their global peers, despite growing inflation concerns

BSE Sensex and Nifty 50 extended their winning streak in the fourth straight session on Tuesday, helped by buying index heavyweights such as ICICI Bank, HDFC Bank and Asian Paints. Both indices finished at record close highs, the BSE Sensex at 52,773.05 and the Nifty 50 Index at 15,869.25. During the day, Sensex hit a new high of 52,869.51, while Nifty hit a new high of 15,901.60. The market spread was positive, as 1,943 stocks rose and 1,280 scripts fell. Larger markets outperformed equity indices. S&P BSE MidCap finished at 22,907.41, up 136.29 points or 0.60%. The S&P BSE SmallCap Index stood at 110.85 points, or 0.44%, at 25,131.70. India VIX, the volatility index, fell 0.74% to end at 14.61 levels, the lowest since February 2020.

Rajesh Palviya is Vice-President – Research (Technical & Derivatives Manager) at Axis Securities

On the daily chart, the index formed a “Doji” candlestick formation indicating market participants’ indecision regarding direction. The index is moving in a Higher Top and Higher Bottom formation on the daily chart indicating a sustained uptrend. The chart diagram suggests that if Nifty crosses and holds above the 15900 level, it would witness some buying that would drive the index towards the 16000-16200 levels. However, if the index goes below the 15800 level, it will witness a sell off which will take the index towards 15650-15500. Nifty is trading above its 20 day SMA indicating a positive short term bias. Nifty continues to remain in an uptrend over the medium to long term, so buying on lows continues to be our preferred strategy. The RSI Daily Strength Indicator is moving upwards and is above its baseline indicating a positive bias

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Milan Vaishnav, CMT, MSTA, Consulting Technical Analyst and Founder, Gemstone Equity Research & Advisory Services

Markets continued to climb and close at new lifetime highs. However, he continued to show a loss of internal strength. RSI remains overbought; it continues to show a bearish divergence on the chart. 15,900 and 16,000 saw significant call writing indicating that NIFTY may be struggling to exceed these levels. Markets also continued to show signs of classic distribution at current levels hinting at the increased importance of profit protection at higher levels.

Manish Hathiramani, Owner Index Trader and Technical Analyst, Deen Dayal Investments

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The Nifty eventually made it to the 15,900 level but ended up closing a bit below. The 15900-16100 area is a resistance block and traders should be careful around these levels. A buy-on-dips approach would be a cautious form of trading this patch. 15700-15750 is a good support for the index and as long as it doesn’t break, we are in bullish territory!

S Ranganathan, Head of Research at LKP Securities

The bulls were firmly in control today as FMCG and Paint stocks were in demand with the broader market also showing renewed buying interest in high quality Midcap stocks across all sectors. Selective themes like Infra, Paper & MFI were in action today amid high volumes of positive news feeds.

Vinod Nair, Research Manager at Geojit Financial Services

Indian stock markets continued to follow the optimism of their global peers, despite growing concerns about inflation. The global market is eagerly awaiting the decision of the two-day Fed policy meeting to see if the central bank would signal a policy change. As the domestic CPI jumped to 6.3% in May, violating the RBI’s comfort zone on the rise in food and energy prices, which are expected to subside due to the opening economy.

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Ashis Biswas, Head of Technical Research at CapitalVia Global Research

The market saw a lackluster move and an attempt to overcome the resistance level around the Nifty 50 index level of 15900. While a break above 15900 is the key factor from a short-term perspective, everything anything above this level is important for the market to gain momentum, which could lead to a projection upwards to 16,200 levels. Momentum indicators such as RSI, MACD strengthen further in favor of a positive outlook and advise traders to view a break above 15900 as an opportunity to build a new long position.

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