The NSE Nifty 50 may face a deeper slide if the key support level of 23,750 is breached, analysts said on Tuesday, after the Indian markets settled with sharp losses.
Global cues turned negative following the close of market hours, with the Wall Street falling sharply on chip stocks rout. The tech-heavy Nasdaq slumped over 2%, whereas the S&P 500 was down by about 1.5%.
The GIFT Nifty, however, indicated a positive start for Wednesday, with the futures trading with an uptick of 0.34% at 23,892 as of 10:12 p.m.
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The Nifty sees immediate support in the 23,800–23,750 zone, which coincides with its previous swing low area, according to Dhupesh Dhameja, derivatives research analyst at SAMCO Securities.
The analyst stated that a decisive break below 23,750 could trigger further weakness towards 23,550, while sustaining above this zone may result in a relief bounce.
"For day traders, the key levels are 23,900 or the 50-day SMA (Simple Moving Average) level for Nifty," Shrikant Chauhan, head of equity research at Kotak Securities, said.
Holding above the 23,750–23,800 zone could lead to consolidation or a pullback towards 24,000–24,100, while a breakdown below this support may accelerate selling pressure in the coming sessions, according to Dhameja.
"On the flip side, if the index moves above 23,900, it could bounce back to 24,000-24,050," Chauhan said.
Bank Nifty
The Bank Nifty finds immediate resistance at 58,300 and 59,250 levels in the coming sessions, according to Bajaj Broking. The index formed a sizable bearish candle with a lower high and a lower low signaling profit booking at higher levels around the 58,000 levels, as per the brokerage.
"However, we believe the overall structure is positive, and any dips should be used to accumulate quality banking stocks in a staggered manner," it said.
The index sees immediate support at 57,100–57,300 levels, according to analyst Dhupesh Dhameja.
"Despite the decline, the index continues to trade above all its key moving averages, indicating that the broader trend remains firmly positive," Dhameja said.
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Market Recap
Domestic equity benchmarks fell on Tuesday, dragged by heavyweight IT and metal stocks, while weak business activity data and concerns over a patchy monsoon triggered profit-booking in the broader market. The NSE Nifty 50 and BSE Sensex fell 1.16% each to 23,824.10 and 76,200.68, respectively.
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