Indian Market Strategy for 25th Oct. | Nifty Trades Positively; 19,400 Crucial Level

The beginning of this week saw the benchmark indices take a sharp downturn.

Nifty experienced a significant drop, closing 260 points lower, while Sensex plunged by 826 points.

This downward trend was widespread across all major sector indices, with the metal sector facing the most substantial decline, plummeting by over 5%.

Today, Indian share markets are trading on a positive note with the Sensex trading up by 31 points at the time of writing, while the Nifty is trading up by 12 points.

Hindalco and Tata Steel are the top BSE gainers, while Infosys and Apollo Hospitals are the top losers.

Check out this short video for detailed market update: Market Ready by Kotak Securities

Here’s a rundown of today’s expected market movements…

Nifty Technical Analysis:

From a technical standpoint, the market commenced the day with cautious movements and gradually breached a crucial support level at 19,500 (65,200).

This breach generated additional selling pressure, ultimately leading to the formation of an extensive bearish candle on the daily chart.

This bearish candle signifies the potential for further weakness from the current market conditions. The short-term market structure continues to demonstrate fragility.

Trading Strategy for Nifty:

For day traders, it is crucial to observe 19,400 (64,900), which aligns with the 100-Day Simple Moving Average (SMA), as a pivotal resistance level.

Should the index descend below this mark, it could potentially slide to the range of 19,200-19,175 (64,400-64,300). In a more pessimistic scenario, the market may even experience a further decline to 19,000 or 18,900 levels.

A shift in the short-term sentiment might become evident should the index ascend beyond 19,400 (64,900), potentially initiating a rapid technical rebound towards 19,500-19,600 (65,200-65,500).

To manage risk effectively, it is advisable to contemplate reducing vulnerable long positions around the 19,500 level.

For investors, a prudent approach would be to consider buying opportunities within the range of 19,050 and 18,950.

For a detailed outlook on markets, check out the recent webinar hosted by our research team here: Stocks & Strategy - October 2023

Bank Nifty Analysis:

In the case of Bank Nifty, the 43,000 level, which coincides with the 200-Day SMA, is anticipated to serve as a significant support level.

A descent to the 42,500 level may transpire without requiring a substantial effort if this support level is breached. Conversely, prominent resistance levels are expected at 43,500 and 43,750.

The Nifty IT index has showcased a lower high at 33,000 levels, signaling a potential extension of the fall to 31,400 or 31,000. Market participants should brace for a period of weakness in the near term.

To learn trading strategies you can apply in the current market, check out our expert-led courses by clicking HERE.

As always, market conditions can shift unexpectedly, so staying informed and implementing proper risk management is essential while making trading decisions.

See you tomorrow!

Kotak Securities

Disclaimer: The information provided in this article is based on technical analysis and does not constitute financial advice. Traders should exercise their own judgement and consult with financial professionals before making any investment decisions.