Nifty Outlook: The trend of decline in the benchmark Nifty50 index continued for the third consecutive day on Friday, November 7. The index fell 17 points to close at 25,492. Overall, Nifty has fallen 786 points from the recent swing high of 26,104 so far. Also, the index is trading below its 50-day exponential moving average (EMA), indicating weakness in the short term.
Now let us understand from the experts how the movement of Nifty will be on Monday, 10th November and which levels will be important. But, before that, let us know what special happened in the market on Friday.
Nifty’s top gainers and losers
Shriram Finance, Bajaj Finance and Adani Enterprises were the top gainers in the Nifty pack. Whereas Bharti Airtel, Tata Consumer Products and Tech Mahindra were dominated by selling and these stocks were among the top losers.
Nifty Metal, PSU Bank and Financial Services were the strongest among sectoral indices. In contrast, a sharp decline was seen in Consumer Durables, IT and FMCG indices.
Broader market performance better
Broader markets outperformed the benchmarks. The Nifty Midcap 100 index rose 0.63%. Whereas, Nifty Smallcap 100 fell marginally by 0.16%.
Rise in Capital Market Stocks
Good buying was seen in capital market stocks after SEBI Chairman Tuhin Kanta Pandey’s assurance that the weekly options expiry will not be stopped suddenly. This was a relief news for investors who were worried about possible restrictions on the derivatives segment.
Finance Minister Nirmala Sitharaman has also made it clear that the government has no intention of closing F&O trading.
Excitement in primary market also
Activity continued in the primary market also. Billionbrains Garage Ventures (Groww)’s ₹6,600 crore IPO was subscribed more than 15 times. The IPO enthusiasm in the primary market will continue next week also. A total of 6 new public issues are going to open in the coming week. These include IPOs of 4 mainboard and 2 SME segments.
In the mainboard segment, PhysicsWallah IPO, Emmvee Photovoltaic IPO, Tenneco Clean Air IPO and Fujiyama Power Systems IPO will be open for investors. These four together will raise approximately ₹10,500 crore. Apart from the opening of new IPOs, there will also be listing of 7 new IPOs in the market next week. These include big listings like Lenskart Solutions IPO and Groww IPO.
Expert opinion on Nifty
Experts still have a mixed view regarding the future direction of the market. However, the indications are clear that the index is currently under pressure and can move only within a limited range.
Siddharth Khemka of Motilal Oswal says that the market may remain range-bound in the confused environment of global signals. However, better-than-expected corporate results and any positive update in India-US trade talks could help the market manage.
Short-term trend of the market is weak
According to Nagaraj Shetty of HDFC Securities, the short-term trend of the market is weak, but the trend in the medium-term is still positive. Shetty believes that Nifty may slip to the important support level of 25,500-25,400. This zone is considered to be a role-reversal support, from where a rise in the index can be seen and an opportunity for ‘buy on dips’ can be created.
Rupak De of LKP Securities says that recently Nifty went below an important moving average, which has further weakened the sentiment. According to him, 25,600 is the main resistance now. As long as the index is below this, the ‘Sell on Rise’ strategy will dominate. On the downside, the support at 25,400 is crucial. If it breaks, the fall may deepen further.
Nifty near important support zone
Nilesh Jain of Centrum Broking says that Nifty is close to the important support zone, from where the market is likely to see a bounce. He says the broad structure of the index currently supports the ‘buy on dips’ model, provided it remains above 25,160.
According to Jain, if Nifty manages to break above 25,700, a strong bullish breakout will be confirmed. Then the index may move towards 26,000.
Bank Nifty Estimates
Sudeep Shah of SBI Securities says that the 20-day EMA zone of 57,400-57,300 will act as immediate support for Bank Nifty. If this level is broken, the fall could go to 56,800.
On the upside, the zone of 58,200-58,300 is an important resistance. If Bank Nifty remains above this range, it may go up to 58,700 in the near term.
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