- Nifty 50 closed 51 points lower, Sensex ended 353 points higher amid volatile trade
- Investors cautious ahead of US Fed policy, with high crude prices and bond yields
- Nifty support seen at 22,600 and 22,500; resistance at 22,850 for market direction
Indian equity benchmarks witnessed range-bound trading on Wednesday, with the Nifty 50 ending 51 points lower while the Sensex closed 353 points higher. Market volatility reflected cautious investor positioning ahead of the US Federal Reserve's policy announcement, with elevated crude oil prices and US bond yields adding to uncertainty.
The Nifty's immediate direction will depend on whether it can sustain a move above 22,850 or slips towards key support levels at 22,600 and 22,500. Market experts recommend a level-based trading approach as the benchmark continues to show volatile and non-directional movement.
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“We are of the view that the intraday market texture is volatile and non-directional; hence, level-based trading would be the ideal strategy for traders,” said Shrikant Chouhan, Head of Equity Research at Kotak Neo. On the downside, the Nifty's immediate support is placed at 22,600, followed by 22,500. Chouhan said the corresponding support levels for the Sensex are 73,000 and 72,500.
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As long as the indices hold these support zones, bullish sentiment is likely to remain intact. On the upside, 22,850 is the immediate resistance levels. A sustained move above these levels could improve the chances of the Nifty advancing towards 23,000.
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The key levels suggest that traders should avoid taking aggressive directional positions until the market establishes a clear breakout or breakdown.
The market's muted performance reflected caution ahead of the US Federal Reserve's policy announcement, as investors remained reluctant to increase risk exposure amid global uncertainty.
“The volatility reflected cautious positioning ahead of the US Federal Reserve's policy announcement. Investors were reluctant to extend risk while Brent remained near $114 per barrel and the US 10-year Treasury yield stayed around 5%,” said Hariselvan Radhakrishnan, Founder and CEO of HST Wealth.
Elevated crude oil prices remain a concern for Indian equities because of the potential implications for inflation, corporate costs and the country's import bill. Meanwhile, movements in US Treasury yields and the Fed's policy commentary could influence global risk appetite and foreign investor flows.
Bank Nifty Outlook
The Bank Nifty ended higher despite opening with a gap-down. The index initially declined towards 53,600, where buying interest emerged, leading to a gradual recovery marked by higher highs and higher lows. However, the rebound lost momentum below 54,400, indicating continued selling pressure at higher levels.
According to Ponmudi R, CEO of Enrich Money, the 54,400-54,600 zone remains the immediate resistance for the banking index. A sustained breakout above this range could extend the recovery towards 55,000-55,200.
On the downside, the immediate support zone is placed at 54,000-53,800. A decisive break below this range could intensify selling pressure and expose the index to 53,500 and potentially lower levels.
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