Nifty: Nifty precariously close to key support levels

The market may be at crucial levels. If the Nifty falls below 21,700-21,900 levels-a key support-the index could fall by another 4% to around 21,200-21,300, which was the low made on June 4, 2024, the day when the Lok Shabha election results were announced, said technical analysts. Kairavi Lukka spoke to four senior analysts about what’s in store for the market in the near term.

Shrikant Chouhan
Head, equity research, Kotak Securities

• We believe that as long as Nifty is above 21,700, there could be a pullback in the index, and the next hurdle will be at the psychological level of 22,500.
• There are few chances of Nifty closing below 21,700, but in that case, it could retest its election time lows of June and fall to 21,250-21,300.
• If we consider March 4 as a base date for relative comparison, then only 35% of NSE 500 stocks were underperforming. If the markets were really weak then it would have been the opposite, which indicates that market breadth is still positive this time around.
• The US 10-year bond yields are below 4% and steep fall in the US markets are also positive for us.

Rohit Srivastava
Founder, indiacharts.com.

• In the very short term, markets look very oversold, and we may see a temporary bounce back.
• However, we think the upside for the benchmark would be limited to 22,400, and on the lower-end Nifty could reach 21,200- around its election day lows.
• There is a possibility of breach of the 21,200 level if the tariff issues do not get resolved in the coming days.

Gautam Shah
Founder, Goldilocks Global Research

• The correction in Indian markets started about six months ago due to local issues, which was followed by a global correction. But in these six months, most of the negatives have been priced in the market, and we believe that 21,500-21,800 remains a key support zone.
• At this level, risk-reward for investors will be very lucrative, and we believe that price correction will end, and time correction will then take place in the coming months.
• It will be a stock picker’s market and a lot of opportunities in various sectors are now emerging on the buy side.
• The Nifty may spend more time in the 21,500-23000 zone in the near term.

Ruchit Jain
Vice president, Motilal Oswal Financial Services

• Market is currently making moves based on global news flows, due to which there is high uncertainty in the markets. But 21,700-21,900 remains an important support zone, which if broken, will open up the possibility of election day lows of 21,280.
• 22,500 is the next hurdle and the current trend remains weak. Volatility is expected to remain high over the next few days, as indicated by the 66% spike in India VIX on Monday.