The Indian stock market witnessed a positive opening today, with the Nifty opening closer to 22750. However, minor profit booking was seen from a higher level, primarily due to selling pressure in Reliance and IT stocks. On the other hand, Bank Nifty continued its positive momentum, with strong performances from ICICIBANK and HDFCBANK consolidating near its resistance zone at 1560.
Sectoral indices such as Realty, Metal, Auto, Financial Services, Infra, and Banking showed superior relative strength, indicating that the momentum is likely to continue. Conversely, IT, Media, and FMCG sectors are expected to underperform in the near future.
From a global market perspective, the Dollar Index remained stable around 104.15, which is a positive sign in the short term. US10 year yields also traded at elevated levels of 4.40%, while Brent Crude Oil prices hovered around $91 a barrel, raising concerns from an Indian perspective. The upcoming US CPI data is crucial as it will determine the Fed’s policy action going forward.
In terms of key Nifty levels, it is important to be cautious as the election dates approach and Brent Crude oil prices rise. Traders are advised to trail their long positions with key support levels in mind. Strong support lies around 22480-22500, with resistance levels at 22830-22870 and 22980-23030.
The Nifty PCR is around 1.05, indicating strength in the indices. Call writing was observed at 22700-22800 strikes, while significant Put writing was seen at 22600-22500 strikes, suggesting a range of 22850 on the upside and 22500 on the downside.
In the banking sector, HDFCBANK, ICICIBANK, and Indusindbk displayed volatility, with sentiments leaning towards buying on dips. The Bank Nifty Index has formed a Higher Top Higher Bottom pattern in the last 5 days. Crucial support levels are at 48300-48400, with resistance at 49100-49250.
Overall, the market outlook remains positive, with certain sectors and stocks showing strong momentum. Technical parameters and Relative Strength charts indicate potential growth in stocks such as IciciBank, Apollo Hospital, Bajaj Finserv, and others.
In terms of FII and DII data, FIIs were net sellers in the cash market, while DIIs bought significantly. FIIs showed a Long short ratio of index futures at 51%, indicating a bullish sentiment. Options data suggests a range of 48400 to 49200 for Bank Nifty in the coming days.
