The Indian stock market benchmark indices are facing a critical technical test at the 23,900 level as the Nifty continues to hover around the 24,000-mark. According to ET Now, Rajesh Palviya, Head of Technical and Derivatives Research at Axis Securities, warned that the index has broken below the important support area of 24,000, which was a major put base concentration. As per Palviya's analysis, the Nifty is now testing an important support zone, with the 23,900 level remaining a key support for the market's expected direction. He noted that as long as the index holds above this zone, the broader trend is likely to remain stable, but warned that if it slumps below 23,900, it could invoke further weakness and increase the likelihood of a deeper correction.
The Indian stock market benchmark indices are likely to open higher on Tuesday, with GIFT NIFTY futures trading nearly 50 points higher at 23,900, indicating a mild-positive start for NIFTY50. According to Upstox, the trends suggest a gap-up start for the Indian benchmark index, with global market cues remaining positive despite a cautious bias as investors now shift focus towards the Federal Reserve's policy meet outcome. The cooling off of crude oil prices, treasury yields, and the US dollar index will ease pressure on Indian markets, while Brent crude oil prices retreated further to around $83 per barrel as investors await further details of the reopening of the Strait of Hormuz. The interim agreement is expected to be signed on Friday, June 19, in Switzerland.
Technical analysts believe that the Nifty can potentially surge to 24,600 from here if it clears hurdles at 23,800 and 24,200-24,300 levels. As per the latest technical analysis, if the index sees follow-up buying interest in the upcoming sessions, the 23,800 level is expected to act as the immediate resistance, followed by the 24,000–24,200 zone as a crucial hurdle for a further sharp uptrend. On the downside, 23,500 is likely to serve as the immediate support, followed by 23,300 as a key support level. According to ET Now, Palviya identified 23,950 as the important level to watch for intraday perspective, noting that if the index recovers about 24,000 level, the trend may resume in coming days. He expects any sustainable move above the 23,770-23,800 zone could result in Nifty extending its pullback towards 23,950, followed by 24,100 levels in the short term.
According to Livemint reports, Bank Nifty index jumped 1,638.05 points, or 2.97%, to close at 56,814.80 on Friday, forming a strong bullish candlestick pattern. Sudeep Shah from SBI Securities noted that Bank Nifty is comfortably trading above all its key moving averages, with the 20-day and 50-day EMAs having started turning higher. He expects Bank Nifty to extend its upward trajectory and test the 57,500 level, followed by 58,300 in the near term. As per ET Now, Bank Nifty is still holding the ground despite volatility, holding above 57,500 and 57,400 levels, which are important to watch for. Palviya noted that Bank Nifty is looking more promising compared to the Nifty at this juncture, with the possibility of seeing a pullback towards 58,000 to 58,200 levels.
India VIX, which measures expected market volatility, declined sharply below 15, and any further easing in volatility could provide additional support to the bullish outlook. The momentum indicator Relative Strength Index (RSI) has rebounded from lower levels and moved above the 50-mark, signalling improving strength in the underlying trend. A long build-up was seen in 107 stocks, while 89 stocks saw short-covering, meaning a decrease in open interest along with a price increase. The maximum Put open interest was seen at the 23,000 strike (with 1.16 crore contracts), which can act as a key support level for the Nifty in the short term, followed by the 23,400 and 23,300 strikes. The increasing PCR, or being higher than 0.7 or surpassing 1, means traders are selling more Put options than Call options, which generally indicates the firming up of a bullish sentiment in the market. On the options data front, 24,000 calls hold the highest open interest, indicating a strong resistance for today's expiry, while 23,500 holds the highest open interest, indicating a near-term support for NIFTY50.
