NIFTY OUTLOOK & TRADING STRATEGY FOR COMING WEEK 29 APRIL 3 APRIL 2024

 Market Overview:

The Indian equity market concluded a volatile session on April 26, snapping a five-day winning streak as the Nifty fell below the crucial level of 22,400. The Sensex closed down by 609 points at 73730, while the Nifty fell by 150 points to 22420. Despite mixed global cues, the market initially started positively but turned negative during the day, erasing all gains and closing near the day's high. For the week, the BSE Sensex rose by 0.9%, and Nifty50 added 1.2%.

Sectoral Performance: Except for the auto, bank, and capital goods sectors, all other indices ended in the green, with notable gains seen in oil & gas, healthcare, realty, and media, ranging from 0.3 to 1 percent.

Stock Movement: Top losers on the Nifty included Bajaj Finance, Bajaj Finserv, Nestle India, IndusInd Bank, and M&M, while gainers were Tech Mahindra, Divis Labs, LTI Mindtree, Bajaj Auto, and BPCL. Notably, more than 250 stocks touched their 52-week high on the BSE.

Volume and Build-up: A significant volume spike of over 100 percent was observed in stocks like L&T Technology Services, Aditya Birla Fashion, and SAIL. Long build-up was seen in Tech Mahindra, GMR Airports Infrastructure, Container Corporation of India, while short build-up was observed in L&T Technology Services, Bajaj Finance, and Bajaj Finserv.

Technical Analysis: On the Nifty daily chart, selling pressure persisted, especially around the resistance zone of 22550– 22650. The index faced resistance at crucial levels, suggesting a consolidation phase. Immediate support is now placed at 22450– 22250, with the 40-day moving average and the 50% Fibonacci retracement level acting as support parameters.

Bank Nifty Outlook: The Bank Nifty's recovery from the previous day's lows lacked follow-up buying interest, leading to potential consolidation. The index faces crucial support at 47600, with divergence on the momentum indicator not supporting the upmove.

Trading Strategy for Monday: Considering the technical analysis and market trends, here's a suggested trading strategy for Monday:

1. Nifty Trading Strategy:

   • Support Levels: Immediate support at 22400, followed by 22300.
   • Resistance Levels: Technical resistance at 22550-22650.
   • Trading Approach: Consider short-term bearish positions if the Nifty breaches the support levels, targeting downside levels. Alternatively, cautiously monitor for a decisive breakout above 22550 for bullish opportunities.

2. Bank Nifty Trading Strategy:

   • Support Level: Crucial support at 47550.
   • Trading Approach: Watch for potential consolidation around support levels. Consider short-term trades based on breakouts above or below this level, keeping a close eye on follow-up buying interest or lack thereof.

3. Stock-Specific Strategy:

   • Long Build-up Stocks: Focus on stocks showing long build-up such as Tech Mahindra, GMR Airports Infrastructure, and Container Corporation of India.
   • Short Build-up Stocks: Monitor stocks with short build-up like L&T Technology Services, Bajaj Finance, and Bajaj Finserv for potential bearish opportunities.

4. Risk Management:

   • Implement proper risk management strategies, including stop-loss orders, to mitigate potential losses.
   • Stay updated on market news and global developments to adjust trading strategies accordingly.

Overall, exercise caution, adapt to market conditions, and adhere to risk management principles while executing trades on Monday.