The Indian stock market benchmark indices, Sensex and Nifty 50, are likely to open lower on Thursday as the additional US tariffs of 25% on Indian exports came into effect. The cumulative tariff imposed by the US on India now stands at 50%.
The trends on Gift Nifty also indicate a weak start for the Indian benchmark index. The Gift Nifty was trading around 24,665 level, a discount of nearly 66 points from the Nifty futures’ previous close.
Indian markets were closed on Wednesday, August 26, due to Ganesh Chaturthi.
On Tuesday, the domestic equity market ended lower, with the benchmark Nifty 50 closing below 24,800 level.
The Sensex cracked 849.37 points, or 1.04%, to close at 80,786.54, while the Nifty 50 settled 255.70 points, or 1.02%, lower at 24,712.05.
Here’s what to expect from Sensex, Nifty 50, and Bank Nifty today:
Sensex Prediction
Sensex formed a long bearish candle on the daily charts and is holding a lower top formation on intraday charts, which is largely negative.
“We believe that the intraday market texture is weak, but a fresh selloff is possible only after the dismissal of the 80,500. Below this level, Sensex could retest the level of 80,200 – 80,000. On the flip side, above 20 day SMA or 81,000, a pullback move is likely to continue up to 81,300 – 81,500,” said Shrikant Chouhan, Head Equity Research, Kotak Securities.
Nifty OI Data
In the derivatives segment, the highest Nifty Call Open Interest (OI) was observed at the 24,800 strike, while the highest Put Open Interest was concentrated at the 24,500 strike. This setup suggests that resistance remains firm near 24,800, and a sustained close above this level will be crucial to revive bullish momentum, said Amruta Shinde, Technical & Derivative Analyst at Choice Equity Broking.
Nifty 50 Prediction
Nifty 50 formed a big bearish candle on the daily chart and broke below the 50-DEMA support at 24,840, indicating fresh weakness.
“A long bear candle was formed on the daily chart post minor bounce of the previous session. This market action indicates strong selling pressure that emerged from the lower top of 25,150 levels. The previous opening upside gap of 18th August has been pierced on the downside and Nifty 50 was not able to show any recovery from near the gap support of around 24,700. This is not a good sign,” said Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities.
According to him, the underlying short-term trend of Nifty 50 is weak and the next lower supports to be watched around 24,600 followed by 24,400 levels. However, any sustainable bounce back above 24,900 could open more short covering for the near term.
Sudeep Shah, Head – Technical Research and Derivatives at SBI Securities noted that the Nifty 50 index slipped below both its 20-day and 50-day EMA, signalling a weakening of near-term momentum. This breakdown below key moving averages reflects growing bearish sentiment and a potential shift in trend dynamics.
“Adding to the negative technical setup, the RSI on the daily chart has triggered a bearish crossover, further reinforcing the downside bias. A bearish RSI crossover typically suggests that selling pressure is intensifying and that the index may struggle to regain upward momentum in the immediate term. Traders and investors may need to exercise caution, as the combination of moving average breakdowns and momentum indicator signals points to a possible continuation of weakness unless a strong reversal emerges,” Shah said.
Going ahead, he believes the 100-day EMA zone of 24,640 – 24,600 will act as immediate support for the Nifty 50 index, and any sustainable move below the level of 24,600 will lead to further correction upto the 24,400 level. On the upside, the 20-day and 50-day EMA zone of 24,830 – 24,850 will act as a crucial hurdle for the index.
Dr. Praveen Dwarakanath, Vice President of Hedged.in said that the momentum indicators have come into the oversold region, which could pose a reason for a bounce from the support level.
“Nifty 50 index filled the gap formed on its way up due to the GST news on August 18. The tariff on India by the US is to be implemented on the 27th August, which can be the reason for the fall as well. Any change in tariff can push the markets on the upside,” said Dwarakanath.
Bank Nifty Prediction
Bank Nifty index slipped 688.85 points, or 1.25%, to close at 54,450.45 on Tuesday, forming a large bearish candle, confirming strong selling pressure at higher levels.
“Technically, the Bank Nifty index broke below the 100-DEMA support as well as the multiple demand zone at 54,900, leading to a head-and-shoulders pattern breakdown and the formation of a big bearish candle on the daily scale. The next key support for Bank Nifty is placed near 53,570, where its 200-DEMA is located. Hence, traders are advised to follow a sell-on-bounce approach in the short term,” said Hrishikesh Yedve, AVP Technical and Derivative Research, Asit C. Mehta Investment Intermediates Ltd.
Om Mehra, Technical Research Analyst, SAMCO Securities highlighted that on the daily chart, the Bank Nifty index has broken below the midline of the Donchian Channel and is now testing the lower band of the channel. The breakdown has brought the index close to its recent swing low of 54,905, which failed to hold as support. A further slip could expose the index to 54,000 or deeper.
“The Bank Nifty index is trading well below all major moving averages, except the 200-SMA. The RSI has dropped to 33, slipping closer to the oversold territory, while the MACD remains in negative territory. The broader trend may stay fragile as the index is unable to sustain above key short-term averages. Support is now placed at 54,000, followed by 53,800, while resistance is capped at 55,000. A mean reversion cannot be ruled out, but a sell-on-rise approach would be preferable for the coming sessions,” Mehra said.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
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