NIFTY OUTLOOK & FREE TRADING TIPS FOR 23 AUG 2024

Market Overview:

Indian benchmark indices concluded the trading session on a positive note, with the Nifty closing above 24,800. The Sensex gained 147 points, closing at 81053, while the Nifty was up by 41 points, closing at 24811.

Sector Performance:

• Top Gainers:

  • Consumer, Metal, and PSU Banks: These sectors saw significant buying interest, driving the market upwards.
  • Top Performing Stocks:
    • Grasim Industries
    • Tata Consumer Products
    • Tata Steel
    • Bharti Airtel
    • Apollo Hospitals

• Top Losers:

  • Selective IT and Energy Stocks: These sectors experienced intraday profit booking at higher levels, leading to marginal declines.
  • Underperforming Stocks:
    • Tata Motors
    • Dr Reddy's Labs
    • NTPC
    • Wipro
    • M&M

• Sectoral Indices Performance:

  • Power Index: Declined by 1%.
  • Pharma, Oil & Gas, Auto, IT: Ended marginally lower.
  • Bank, FMCG, Metal, Realty, Telecom: Gained between 0.5% and 1.4%.
  • BSE Midcap and Smallcap Indices: Both rose by 0.5%.

Technical Analysis:

• Nifty:

  • The Nifty opened with a gap-up but faced intraday profit booking, leading to the formation of a small bearish candle on the daily charts, indicating indecisiveness between bulls and bears.
  • The index encountered resistance at the previous downside gap zone of 24,850-25,000, closing just below this range.
  • Immediate support is seen at 24,720, with key resistance between 24,900-24,950.
  • The short-term trend remains positive, but overbought conditions could lead to range-bound activity. A decisive breakout above the resistance could push the Nifty towards 25,100 in the near term.

• Bank Nifty:

  • Bank Nifty continued its positive momentum, closing above key daily moving averages. The daily momentum indicator shows a positive crossover, signaling a potential upmove towards 51,500-51,900. A stop loss of 50,400 should be maintained for long positions.

Global Cues:

• The domestic market's modest gains were influenced by positive global sentiments. Weakness in the US non-farm payroll data has increased the likelihood of an interest rate cut by the US Federal Reserve in September, boosting investor sentiment.

Market Outlook:

• Trading Strategy:

  • Given the current market conditions, a "buy on dips and sell on rallies" approach is recommended.
  • Traders should monitor the key support zones of 24,750-24,700 (Nifty) and 80,800-80,650 (Sensex). A breach below these levels could change market sentiment, leading to a potential exit from long positions.

• Market Sentiment:

  • Despite the gains, the market exhibited a lackluster movement at higher levels, closing with modest gains. The narrow range movement suggests consolidation, with no significant reversal patterns emerging at the highs.

Conclusion:

The Indian equity market continues to show resilience with positive momentum. However, with the Nifty nearing critical resistance levels and showing signs of consolidation, traders should remain cautious and adopt a strategic approach to capitalize on potential market movements in the coming sessions.