Tuesday, December 3, 2024

NIFTY OUTLOOK & TRADING TIPS FOR 4 DEC 2024

Indian equity markets extended their gains for the third consecutive session on December 3, 2024, driven by positive global sentiment, robust buying in banking, and media stocks, while selective profit booking was observed in defensive sectors.

Market Overview

  • Sensex:

    • Closed at 80,845.75, up 597.67 points (+0.74%).

  • Nifty:

    • Closed at 24,457.15, up 181.10 points (+0.75%).

  • Advance-Decline Ratio:

    • Advancers: 2,647, Decliners: 1,190, Unchanged: 99

Sectoral Performance

  • Top Performing Sectors:

    • PSU Banks (+2%)
    • Media (+2%)

  • Subdued Sectors:

    • FMCG and Pharma experienced intraday profit booking.

Top Gainers and Losers (Nifty 50)

Top Gainers:

  1. Adani Ports
  2. NTPC
  3. Adani Enterprises
  4. Axis Bank
  5. SBI

Top Losers:

  1. Bharti Airtel
  2. ITC
  3. Hero MotoCorp
  4. HDFC Life
  5. Sun Pharma

Technical Highlights

  • Nifty closed above the critical resistance level of 24,350, signaling further upside potential.

  • Formation of a bullish candle on daily charts along with a higher bottom pattern indicates positive sentiment.

  • Key Levels:

    • Support: 24,350 / 24,250
    • Resistance: 24,600 / 24,700

  • The breakout from an Inverted Head and Shoulders pattern confirms a trend reversal, with a projected target of 25,440.

Trading Strategy

  • For Bulls:
    • Adopt a "buy on dips" approach as long as indices trade above 24,350.
  • For Bears:
    • Watch for a break below 24,350, which could trigger correction toward 24,150.

Currency Update

  • The Indian Rupee touched a record low early in the session due to strong USD momentum and economic slowdown concerns. However, RBI intervention and strong equity performance led to recovery.
  • USD/INR Range: 84.45 - 84.90

Outlook

  • Sustained momentum could push Nifty towards 24,700 in the near term.
  • Midcap and smallcap indices are likely to outperform, supported by renewed investor confidence.
  • Continued focus on RBI policies, global cues, and corporate earnings will drive market direction.

Investor Focus Areas:

  • Banking (especially PSU) and IT sectors hold potential for further upside.
  • Cautious approach recommended for FMCG and Pharma.

This strong start to December showcases resilience amidst global uncertainties, hinting at optimism for year-end performance.

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