1 day ago
Nifty Bounces From 200 WMA, Trims Losses on Expiry Day
The Nifty stock index started the day lower but recovered some of its losses.
It bounced after reaching an important long-term average called the 200-week moving average.
This average has been decisively broken only twice before, in 2008 and 2020.
The recovery happened on a monthly expiry day, when some market contracts end.
Lower India VIX showed that expected market nervousness had eased below 14.
Banking stocks helped lead the rebound.
Pharmaceutical companies performed best among major sectors, while consumer durable companies performed worst.
Analysts identified important price levels that could guide the market next.
Nifty recovered from early weakness on the monthly expiry day after bouncing from its 200-week moving average.
The index has decisively breached the 200 WMA only twice previously—in 2008 during the Global Financial Crisis and in 2020 during the Covid-19 pandemic.
The recovery was supported by India VIX falling below 14 and strong buying in major banking stocks.
Nifty Pharma was the best-performing major sector, while Nifty Consumer Durables performed worst.
The Sensex was last trading at 72,380.77, down 390.95 points, or 0.54 per cent, after falling to 72,064.24.
- Who
- Indian benchmark indices, investors, and market analysts including Sudeep Shah of SBI Securities.
- What
- The Nifty recovered from early losses after bouncing from its 200-week moving average, while the Sensex remained lower.
- Where
- In the Indian stock market.
- When
- On the monthly expiry day, during the reported trading session.
- Why
- The rebound was supported by India VIX cooling below 14 and buying in major banking stocks, while investors continued tracking crude oil, the US dollar, global bond yields, and foreign fund flows.
Recovery Signals
Continuing Risks
Market direction
Recovery Signals
The Nifty staged a strong recovery from lower levels, helped by easing India VIX and buying in frontline banking stocks.
Continuing Risks
The benchmark indices remained under pressure in recent sessions and the Sensex was still down 0.54 per cent in the latest reported trading.
Technical outlook
Recovery Signals
A rise above 22,870 could extend the Nifty rally toward 23,020.
Continuing Risks
A fall below 22,540 could send the Nifty toward the 22,370–22,390 support zone.
Investor concerns
Recovery Signals
Cooling volatility and sectoral buying offered support during the session.
Continuing Risks
Investors continued to monitor crude oil prices, the US dollar, global bond yields, and foreign fund flows.
Key facts
- Nifty support
- 22,540–22,560; below this, the next support is 22,370–22,390.
- Nifty resistance
- 22,850–22,870; a move above this could extend the rally toward 23,020.
- Sensex latest level
- 72,380.77, down 390.95 points or 0.54 per cent.
- Sensex session low
- 72,064.24 in early trade.
- Sensex levels
- Support at 72,100 and resistance at 73,000.
- India VIX
- Fell below 14 during the recovery.
- Options activity
- Call writing was seen at the 22,800 and 22,900 strikes; put open interest was substantial at 22,700 and 22,600.
Quotes
Sudeep Shah
Vice-President for Technical and Derivatives Research at SBI Securities
“The frontline indices witnessed a strong recovery on the monthly expiry day, supported by India VIX cooling below the 14 mark. Despite heightened volatility and a negative start to the session, Nifty staged a smart rebound from lower levels, led by strong buying in frontline banking counters.”
businesstoday.in
“Meaningful call writing was witnessed across 22,800 and 22,900 strikes. On the put side, 22,700 has a substantial open interest, followed by the 22,600 strike.”
businesstoday.in
Sources
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