May 9th, 2023
The Indian stock market witnessed a mixed day of trading , May 9th, with the benchmark index Nifty opening on a negative note due to negative global cues. However, the downside was limited due to buying seen in midcap stocks.
Nifty ended the day a tad below 18100 with a loss of about one-third of a percent.
Nifty Today:
Nifty corrected due to negative global cues, but the downside was limited due to buying seen in the midcap stocks. The momentum readings on the lower time frame chart were in the overbought zone, and hence a corrective move was much required. Now, the support for Nifty is placed around 18000-17970 and any decline towards this support zone could then witness buying interest. The FED meeting outcome will be important to watch out as how the global markets react to the same will have an impact on our markets too. However, until we see any signs of reversal, one should trade with a buy on dip approach in the index. In options segment, 18000 put in Nifty and 43000 put option in Bank Nifty have decent open interest build-up which would be seen as supports on the weekly expiry day.
Indices witness pullback ahead of FED event, midcaps outperform:
The above data and chart structure indicate just a correction within an uptrend in the index. Hence, one can look for buying opportunities in the index on declines towards the support zone. On the other hand, one should keep focusing on the stock-specific opportunities from the cash segment as the outperformance is likely to continue there.
Nifty and Bank Nifty Levels and FINNIFTY Levels:
Support 1:
Nifty: 18000
Bank Nifty: 42970
FINNIFTY: 19050
Support 2:
Nifty: 17970
Bank Nifty: 42870
FINNIFTY: 19000
Resistance 1:
Nifty: 18150
Bank Nifty: 43520
FINNIFTY: 19265
Resistance 2:
Nifty: 18200
Bank Nifty: 43700
FINNIFTY: 19330
In the current scenario, the Nifty and Bank Nifty are expected to trade higher amid positive global cues, with the first support for Nifty at 18074 and then 18018, and the first support for Bank Nifty at 42372 and then 42024. The resistance levels for both indices are at 18227 and 18324. The Nifty futures on the Singapore Exchange (SGX) were trading 33.5 points or 0.18% higher at 18,157.5 in today’s early morning trade.
Overall, until Nifty shows any signs of reversal, one should trade with a buy on dip approach in the index. The FED meeting outcome will be important to watch out for, as it could have an impact on the global markets and in turn, on the Indian markets. One can also look for buying opportunities in the index on declines towards the support zone. In addition, focusing on stock-specific opportunities from the cash segment could be a good strategy, as midcap stocks have been outperforming.
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