Despite the recovery, domestic markets seem to be under pressure as nervous investors continue to book profits to capitalise on record run witnessed over the past few sessions.
At around 12 pm, both the indices were back in positive territory, but trading flat amid a seemingly volatile session.
New Delhi,UPDATED: Dec 21, 2023 12:25 IST
Benchmark stock market indices encountered wild swings in early trade following yesterday’s crash, which marked the worst session for Dalal Street in months.
The S&P BSE Senxex fell over 0.5 per cent in early trade to open below 70,000, while the NSE Nifty 50 opened just marginally above 21,000. At around 12 pm, both the indices were back in positive territory, but trading flat amid a seemingly volatile session.
Despite the recovery, domestic markets seem to be under pressure as nervous investors continue to book profits to capitalise on record run witnessed over the past few sessions.
Bears vs bulls
The domestic markets are currently witnessing a duel between the bears and bulls as both sides are trying to get a hold of proceedings. This has led to wild intraday swings, creating a sense of uncertainty among investors.
According to market analysts, the profit booking witnessed since yesterday’s session is a result of a lull in global markets and uncertainty due to rising Covid-19 cases in India and several countries across the world.
Mixed response
Ahead of today’s market opening, Mandar Bhojane, research analyst at Choice Broking, said, “Technical charts suggest that after reaching an all-time high, the Nifty formed a large bearish candle at the top, indicating a potential correction in the near future.”
He went on to suggest that the Nifty may find support at 20,900, followed by 20,800, while on the upside, 21,350 could serve as immediate resistance, followed by 21,500.
Another factor that has led to cautious sentiments among investors and traders is selling by foreign investors. According to provisional data from the National Stock Exchange, foreign institutional investors (FIIs) net sold shares worth Rs 1,322.08 crore on December 20.
On the other hand, domestic institutional investors (DIIs) continued to provide support, buying Rs 4,754.34 crore worth of stocks yesterday.
“The substantial buying from both FIIs and DIIs, as mentioned above, is expected to provide some correction in the coming days. Therefore, traders and investors are advised to maintain their long positions with a trailing stop loss set at 21,000 levels,” Bhojane said.
Meanwhile, Aditya Gaggar, Director of Progressive Shares, said, “With a strong bearish candle at record levels, it seems that the short-term trend turned in favor of the bears but in the lower timeframe, it is developing a possibility of a hidden bullish divergence, and if the index reverses from the support zone of 21,040- 21,080, we can expect a recovery in the markets which will be restricted to 21,380.”
“Traders need to remain cautious while this correction will provide good buying opportunities for the investors,” he added.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)
Published By:
Koustav Das
Published On:
Dec 21, 2023
English (US) ·