Where is share market headed after Nifty closes below 18290, Bank Nifty falls to 43900; check support, resistance

NSE Nifty 50 looks weak for the short term and analysts advise investors to adopt sell on rise approach.

Share Market tomorrow 17 May 2023
Nifty and Sensex concluded today's session in the red territory on profit booking.

Benchmark indices NSE Nifty 50 and BSE Sensex ended Tuesday’s session deeply in the red. The NSE Nifty 50 tanked 112.35 points or 0.61% to 18,286.5 and BSE Sensex plunged 413.24 points or 0.66% to 61,932.47. In sectoral indices, Bank Nifty tumbled 168.40 points or 0.38% to 43,903.70, Nifty Auto fell 130.15 points or 0.93% to 13,877.70 while Nifty PSU Bank rose 28.90 points or 0.72% to 4,049.70. The top gainers on Nifty 50 were BPCL, Coal India, ONGC, Bajaj Finance and NTPC while the losers were Kotak Bank, Tata Motors, Mahindra & Mahindra, Apollo Hospital and Maruti Suzuki.  

“The domestic benchmark’s ascent towards a record high was interrupted by selling pressure in heavyweight stocks, although small and mid-cap stocks outperformed. As anticipated, the Eurozone economy experienced modest growth of 0.1% QoQ in the Jan-Mar period, following a stagnant previous quarter. In the US market, cautious trading prevailed as debt-ceiling negotiations took precedence,” said  Vinod Nair, Head of Research at Geojit Financial Services.

Where are NSE Nifty 50, Bank Nifty headed?

‘Sell on rise’ advisable for Nifty until 18450 levels are attained

“NSE Nifty 50 has formed a bearish candle in the daily chart and almost formed Marubozo. As it closed below 18300, the overall structure shows that the index will likely witness consolidation or profit booking from higher levels. OI Data indicates, on the call side the highest OI is witnessed at 18500 followed by 18400 strike price while on the put side, the highest OI remains at 18200 followed by 18100 strike price. Overall, Index looks weak for the short term; sell on rise would be advisable in the coming days until 18450 levels are attained. Nevertheless, this volatility might offer traders enough chances for short-term gain on both the buy and sell sides,” said Om Mehra, Equity Research Analyst at Choice Broking.

Bank Nifty may witness further correction towards 43500

Bank Nifty witnessed some profit booking at a higher level and the major contributors were HDFC twins. The index, if sustains below 44,000, can witness further correction towards 43,500 where the highest open interest is built up on the put side. The momentum indicator RSI is showing negative divergence which confirms the bearishness,” said Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities.

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First published on: 16-05-2023 at 16:17 IST