What can we anticipate from the Indian stock market’s performance in trading on May 14th, including the Nifty 50 and Sensex?
The outlook for the Indian benchmark indices, Sensex and Nifty 50, appears to be cautiously optimistic for Tuesday’s trading session, influenced by mixed global market trends. The Gift Nifty, a pre-market indicator, suggests a marginally positive start, trading around 22,245, indicating a slight premium compared to the previous close of Nifty futures.
Yesterday, the Indian stock market witnessed a volatile session ending with moderate gains, largely driven by late-session buying activity. The Sensex closed up 111.66 points at 72,776.13, while the Nifty 50 settled 48.85 points higher at 22,104.05. Notably, the Nifty 50 formed a ‘Bullish Hammer’ candlestick pattern, signaling a potential short-term bullish reversal.
Ruchit Jain, Lead Research at 5paisa.com, suggests that a move above Monday’s high could reinforce positivity in the near term. He identifies the 100-day Exponential Moving Average (DEMA) at 21,827 as a crucial support level, advising traders to use it as a reference for stop-loss levels. Resistance levels are anticipated around 22,200 – 22,270, followed by 22,310.
Regarding specific strategies, Jain recommends seeking stock-specific buying opportunities but advises against aggressive positions, emphasizing the importance of Friday’s low as a stop-loss reference at the Nifty level.
Looking at the Open Interest (OI) data for Nifty, Deven Mehata, Research Analyst at Choice Broking, notes significant OI on the call side at 22,300 and 22,500 strike prices, while on the put side, it’s highest at 22,000.
Forecasting Nifty 50’s movement, Rupak De, Senior Technical Analyst at LKP Securities, points out a hammer pattern on the daily chart, suggesting a potential bullish reversal after a correction. However, he warns of resistance around 22,150 – 22,200, with support at 21,950.
V.L.A. Ambala, Co-founder of Stock Market Today (SMT), anticipates sectors like metals, FMCG, IT, and media to perform well in the next session. He interprets the Nifty’s ‘Double Top’ pattern as bearish in the short term, cautioning about high buying activity with an RSI of 70 on the monthly timeframe.
For Bank Nifty, Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities, highlights a strong recovery and suggests a potential pullback towards the 20-day moving average at 48,200. As long as the index maintains support around 47,200, Shah remains bullish.
