Nifty Outlook: Nifty 50 started trading on Friday with a fall of 83 points. The initial weakness lasted for about an hour, but after that the index showed a sharp intraday recovery of 123 points from the morning low. At one time it seemed in the market that it would recover from the fall.
After 1 pm, Nifty could not save its gains and went into sharp decline. The index closed at 26,068, down 127 points from intraday high of 26,179. Attempts to recover were made several times throughout the day, but each time the selling increased, breaking the two-day bullish trend.
Now let us understand from the experts how the movement of Nifty will be on Monday 24th November and which levels will be important. But, before that, let us know what special happened in the market on Friday.
Most indexes in red
On Friday, all major indices closed in the red. Nifty closed below 26,100 and 30 stocks were in decline. Only a few stocks like Maruti, Tata Consumers and Max Healthcare were able to close higher. Metal stocks were most under pressure, with JSW Steel, Hindalco and Tata Steel being the major losers.
Sectoral performance also weak
Most sectors performed poorly. Except Nifty FMCG, all sectors remained in the red. Nifty Metals, Realty and PSU Banks recorded the biggest decline. IT shares also remained under pressure as US tech stocks were weak, while Nvidia’s results were better than expected.
Midcap-smallcap also closed weak
Broader market also remained under more pressure than Nifty. Nifty Midcap 100 declined 1.13%, while Nifty Smallcap 100 lost 1.22%. This means that even small and mid-sized stocks saw strong selling.
Pressure increased due to US policy and job data
Market sentiment was also affected by increased uncertainty regarding US monetary policy. Expectations of a rate cut in December weakened significantly as employment increased more than expected in September’s jobs data. This reduced investors’ willingness to take risks.
Rupee hits new record
The effect of weak sentiment was also visible on the rupee. The Indian rupee fell to a new record low of 88.83 per dollar. This level also surpassed the earlier high of 88.80, which was seen in the same month and at the end of September. The pressure on the rupee increased further due to weakening expectations of Fed rate cut.
Expert opinion on Nifty
Experts are showing a positive outlook with caution for the coming week. According to Siddharth Khemka of Motilal Oswal, the market may show strength next week. This is due to buying on dips, better demand estimates in Q3 and stable fund flows. Also, any new developments in India-US trade talks could become a short-term trigger for the market.
Nifty trend still positive
Nagaraj Shetty of HDFC Securities says that the short term trend of Nifty is positive. The current decline may form a higher bottom around 26,000-25,900 in the coming sessions. Shetty expects Nifty to bounce off the support levels next week, while immediate resistance lies between 26,250–26,300.
Expectation of rise after consolidation
Nilesh Jain of Centrum Broking believes that there may be some consolidation in Nifty before the next rise. According to him, the index may move in the range of 25,800 to 26,200. The 21-day moving average i.e. 25,840 can provide important support. Jain says that the breakout above the recent swing high will open the way to a new record level i.e. 26,300.
Jain said that the Volatility Index (VIX) has jumped by more than 10% and reached above 13. This is a negative sign for the market. For a bullish return, VIX will need to fall below 12.5.
Challenges continue in the short-term
Rupak Dey of LKP Securities says that sentiment may remain under some pressure in the near term. The decline may extend further to 25,920-25,900. Whereas 26,166 is an important resistance, closing above which can improve the market sentiment.
5DEMA is still supporting
According to Nandish Shah of HDFC Securities, despite Friday’s sharp fall, Nifty still remains above its 5-day exponential moving average (5DEMA) of 26,038. A break below this level will act as the recent swing low – 25,856 as an important support. Whereas 26,277 is still the short-term resistance of Nifty.
Stocks to Watch: These 15 stocks will be in focus on Monday 24th November, you may get a chance to earn huge profits.
Disclaimer: The advice or opinions expressed on Moneycontrol.com are the personal views of the expert/brokerage firm. The website or management is not responsible for this. Moneycontrol advises users to always seek the advice of a certified expert before taking any investment decision.