The Indian equity market is bracing for a subdued opening on Wednesday, with benchmark indices likely to start flat despite a positive trend in global markets. This follows a third consecutive day of losses for domestic stocks, leaving investors cautious about the near-term trajectory.
Market Outlook and Technical Analysis
On Tuesday, the Sensex plunged 503.63 points, or 0.59%, to settle at 85,138.27. The broader Nifty 50 index dropped 143.55 points, or 0.55%, closing at 26,032.20. The trends observed on Gift Nifty, trading around the 26,206 level, also signal a muted start for the Indian benchmarks.
Shrikant Chouhan, Head of Equity Research at Kotak Securities, noted that the Sensex formed a bearish candle on daily charts. He stated that while the intraday market texture appears weak, a fresh selloff is contingent on the index breaking below the 85,000 level. "If the index manages to trade above this level, it could bounce back to 85,500 - 85,800. On the flip side, below 85,000, selling pressure is likely to accelerate," Chouhan explained. He believes a fall below this support could drag the Sensex down to 84,500 - 84,300.
Nifty 50: Resistance and Support Zones
The Nifty 50 formed a small red candle with shadows, indicating market indecision. Hrishikesh Yedve, AVP of Technical and Derivative Research at Asit C. Mehta Investment Intermediates Ltd., identified 26,325 as a major near-term resistance. He advises that until the index sustains above this level, any bounce should be seen as an opportunity for profit booking. On the lower side, 25,840 is a crucial support base, marking the short-term swing low.
Amruta Shinde, Technical & Derivative Analyst at Choice Equity Broking, pointed to derivatives data showing aggressive call writing at the 26,100 strike and strong put open interest buildup at 26,000. This suggests a narrow, range-bound setup. She emphasized that a sustained close above 26,300 is essential to revive bullish momentum.
Echoing this, Ponmudi R, CEO of Enrich Money, said immediate resistance for Nifty is at 26,130–26,200, with a major hurdle at 26,300. "A decisive breakout above 26,300 could trigger a broader range expansion toward 26,500. However, strong Put writing at 26,000 continues to act as a near-term cushion," he added.
Bank Nifty Awaits RBI Policy Cue
The banking index, Bank Nifty, declined 0.68% to close at 59,273.80 on Tuesday, forming a candle with a long upper shadow that reflects selling pressure at higher levels. Analysts expect the index to consolidate ahead of the Reserve Bank of India's (RBI) monetary policy decision.
Bajaj Broking Research expects Bank Nifty to form a base in the 58,500 - 60,100 range. They noted that the entire uptrend of the last two months is well-channeled, indicating sustained demand. Key support is placed at 58,300 - 58,600 levels. Sudeep Shah from SBI Securities highlighted that the 20-day EMA zone of 58,950 - 58,850 is an important support, while 59,600 - 59,700 acts as a crucial hurdle. A move above 59,700 could lead to a rally towards 60,200.
Considering the overall setup, market experts recommend a cautious approach. Traders are advised to consider buying near identified support levels and selling near resistance until a clear directional breakout occurs.
