Everytime the market begins to feel that a recovery is in store, there is something that turns up to prove all expectations wrong. Monday's fall in the market is proof of that. Just as the market was starting to show signs of recovery due to the AI meltdown, cooling down of the bond yields and a some not-so-disappointing IT results, higher crude oil prices have emerged as the bogey man yet again.
After returning from the Dusshera holiday on Wednesday, the market will have to grapple with even higher oil prices, as Brent crude is now trading close to the $112 a barrel mark. There are some big tech results that begin from overnight, which will have to be digested as well.
Then of course, is the mother of all IPOs, the Jio Platforms IPO, which will open for subscription on Wednesday as well. The ₹30,213 crore issue has received a thunderous response from anchor investors and it will be interesting to see how non-institutional investors and the retail participants respond to the same.
Amidst all of this, results continue to play their part too, as the slightest of misses get punished, as was the case with Urban Company and Himadri Specialty Chemicals on Monday, Wednesday's session will see the market react to results from Bajaj Finance, L&T Technology Services, Hindustan Zinc, IREDA, Piramal Finance, Sobha and many others.
While no results were reported on Tuesday, Wednesday will see companies like Eternal, KEI Industries, M&M Finance, Mahindra Holidays, SRF, Vishal Mega Mart, among others report numbers for the quarter gone by, along with companies such as Indian Hotels and Aditya Birla Sun Life AMC.
With the Nifty having broken below the 23,000 level yet again, the focus has moved back to lower levels instead of aiming for the higher ones. 22,800 on the downside is something that the bulls would want to protect, else the downside back towards the 22,700 - 22,650 levels would potentially open up yet again.
Ajit Mishra of Religare Broking said that the fall on Monday has taken the Nifty back to its 20-Day Exponential Moving Average support of 22,900 level, below which the next level on the downside is seen between 22,550 - 22,750 zone. Any recovery on the upside, the 23,200 - 23,300 level is likely to be the first line of resistance.
The correction has brought Nifty close to its key support at 22,800, where the 20-day SMA coincides with the previous swing high. The bullish setup in indicators and oscillators remains intact, and the latest decline does not, by itself, signal a trend reversal.
Nifty could find support around 22,800 and resume its uptrend. However, a decisive break below the positional support at 22,500 would weaken the bullish outlook and warrant caution. VINAY RAJANI, HDFC SECURITIESThe Nifty Bank too has closed very near to its near-term support zone of 55,500 and in case there happens to be sustained selling below that mark, it can take the index back down to 55,000 or even 54,500 on the downside.
Any potential recovery on the upside could encounter hurdles at the 56,000 level. Vatsal Bhuva of LKP Securities said that although the Nifty Bank fell on Monday, it has managed to close above its 20-DMA and above the crucial 55,200 support zone. He also wants a sustained close above the 56,000 mark to confirm a bullish reversal.
Until then, he recommends treating this move only as a pullback and advises reviewing the existing long positions in case the index falls below the 55,000 mark. Om Mehra of SAMCO Securities said that the near-term setup for the index remains sideways to weak, as long as it stays below the 56,000 mark, as the heaviest put Open Interest is at 55,000, followed by the highest Call Open Interest at 55,000.