Bulls vs Bears: Which way will Dalal Street swing today? Here's what experts say
Sensex and Nifty ended deep in the red on Friday, weighed down by a selloff in US markets as investors were worried that higher interest rates the Federal Reserve was using in its fight against inflation could derail the economy.
- May 9, 2022,
- Updated May 9, 2022 7:29 AM IST
It was a tough week for the investors on Dalal Street as the equity benchmarks crashed nearly 4 per cent amid weak global cues, rising concern over inflation, foreign fund outflows and a surprise interest rate hike by the Reserve Bank of India (RBI) weighted sentiment.
Sensex and Nifty ended deep in the red on Friday, weighed down by a selloff in US markets as investors were worried that higher interest rates the Federal Reserve was using in its fight against inflation could derail the economy.
Sensex ended 866 points lower at 54,835 and Nifty lost 271 points to 16,411 in the last trading session of this week. The 30-share BSE Sensex tanked 2225.29 points, or 3.90 per cent, to 54835.58 during the week gone by. Likewise, the 50-share NSE Nifty index slipped 691.30 points or 4.04 per cent to 16,411.25.
Who will win the battle today? Bulls or Bears? Here's what experts say:
"In the coming week, participants will first react to the Reliance numbers which were announced post-market on Friday. Besides, developments on the Russia-Ukraine front and the performance of global markets will be on the radar. On the macroeconomic front, IIP and CPI Inflation data are scheduled for May 12 and the market will be closing eyeing these numbers, to gauge the next possible move from the RBI in the June meeting," said Ajit Mishra, VP Research, Religare Broking.
He noted that the markets are reeling under tremendous pressure and indications are in the favour of further decline ahead. Nifty has the next major support at 16,000 levels and the 16,650-16,800 zone would act as a hurdle in case of any rebound.
"Most sectors, as well as the broader indices, are trading in sync with the benchmark however select stocks are still holding strong. However, since global cues are largely dictating the trend, we recommend focusing more on overnight risk management and maintaining position on both sides," he added.
Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One Ltd said, "Globally, things have become extremely bleak and it would be very difficult to assess the situation there. Despite this, we do not want to get carried away and hence, would avoid going short aggressively. If we take a glance at the daily time frame chart, we can see the ‘Pennant’ pattern target in the vicinity of 16200 – 16000, which is not far away from the current level."
"Hence, we would rather wait for some reversal in the coming week. On the higher side, 16500 followed by 16700 are the immediate levels to watch out for. Let’s see how things pan out globally and be hopeful for some sustainable relief on that front," he added.
Sharing the technical view, Yesha Shah, Head of Equity Research, Samco Securities noted that the short-term trend has turned bearish and it is likely that markets can further slide lower.
"Having said this, if we look at the larger picture, the benchmark index is trading mostly in a wider range of 16,400 to 18,400 since October. Therefore, a bounce from current levels also cannot be ruled out. Keeping this in mind, traders are advised to avoid initiating fresh shorts at current levels. Traders can maintain a neutral to mild negative bias and look for sell-on-rise opportunities. The immediate support and resistance are now placed at 16,000 and 16,800 levels," he said.
According to Mohit Nigam, Head - PMS, Hem Securities, the Immediate support and resistance for Nifty are 16,200 and 16,800 respectively. Immediate support and resistance for Bank Nifty are 34,000 and 35,500 respectively.
"Nifty has formed a Bearish candlestick pattern on a weekly chart which indicates selling pressure. Furthermore, the index has given closing below 61.80 per cent Retracement level of its previous up move from 15671 to 18115 level which suggests more selling in upcoming sessions. Moreover, Index has been trading below the Neck line of Head & Shoulder Pattern which is a sign of bearishness in the counter," said Palak Kothari, Research Associate, Choice Broking.
"The index has been trading below 21*50-Days Simple Moving Averages indicating southward direction for the upcoming session. However, the momentum indicator STOCHASTIC is trading with a negative crossover on a daily Charts which indicates downside movement can be seen. The Nifty may find support around 16300 levels, while on the upside 16600 may act as an immediate hurdle for the index. On the other hand, Bank nifty has support at 33800 levels while resistance at 36000 levels," Kothari added.
It was a tough week for the investors on Dalal Street as the equity benchmarks crashed nearly 4 per cent amid weak global cues, rising concern over inflation, foreign fund outflows and a surprise interest rate hike by the Reserve Bank of India (RBI) weighted sentiment.
Sensex and Nifty ended deep in the red on Friday, weighed down by a selloff in US markets as investors were worried that higher interest rates the Federal Reserve was using in its fight against inflation could derail the economy.
Sensex ended 866 points lower at 54,835 and Nifty lost 271 points to 16,411 in the last trading session of this week. The 30-share BSE Sensex tanked 2225.29 points, or 3.90 per cent, to 54835.58 during the week gone by. Likewise, the 50-share NSE Nifty index slipped 691.30 points or 4.04 per cent to 16,411.25.
Who will win the battle today? Bulls or Bears? Here's what experts say:
"In the coming week, participants will first react to the Reliance numbers which were announced post-market on Friday. Besides, developments on the Russia-Ukraine front and the performance of global markets will be on the radar. On the macroeconomic front, IIP and CPI Inflation data are scheduled for May 12 and the market will be closing eyeing these numbers, to gauge the next possible move from the RBI in the June meeting," said Ajit Mishra, VP Research, Religare Broking.
He noted that the markets are reeling under tremendous pressure and indications are in the favour of further decline ahead. Nifty has the next major support at 16,000 levels and the 16,650-16,800 zone would act as a hurdle in case of any rebound.
"Most sectors, as well as the broader indices, are trading in sync with the benchmark however select stocks are still holding strong. However, since global cues are largely dictating the trend, we recommend focusing more on overnight risk management and maintaining position on both sides," he added.
Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One Ltd said, "Globally, things have become extremely bleak and it would be very difficult to assess the situation there. Despite this, we do not want to get carried away and hence, would avoid going short aggressively. If we take a glance at the daily time frame chart, we can see the ‘Pennant’ pattern target in the vicinity of 16200 – 16000, which is not far away from the current level."
"Hence, we would rather wait for some reversal in the coming week. On the higher side, 16500 followed by 16700 are the immediate levels to watch out for. Let’s see how things pan out globally and be hopeful for some sustainable relief on that front," he added.
Sharing the technical view, Yesha Shah, Head of Equity Research, Samco Securities noted that the short-term trend has turned bearish and it is likely that markets can further slide lower.
"Having said this, if we look at the larger picture, the benchmark index is trading mostly in a wider range of 16,400 to 18,400 since October. Therefore, a bounce from current levels also cannot be ruled out. Keeping this in mind, traders are advised to avoid initiating fresh shorts at current levels. Traders can maintain a neutral to mild negative bias and look for sell-on-rise opportunities. The immediate support and resistance are now placed at 16,000 and 16,800 levels," he said.
According to Mohit Nigam, Head - PMS, Hem Securities, the Immediate support and resistance for Nifty are 16,200 and 16,800 respectively. Immediate support and resistance for Bank Nifty are 34,000 and 35,500 respectively.
"Nifty has formed a Bearish candlestick pattern on a weekly chart which indicates selling pressure. Furthermore, the index has given closing below 61.80 per cent Retracement level of its previous up move from 15671 to 18115 level which suggests more selling in upcoming sessions. Moreover, Index has been trading below the Neck line of Head & Shoulder Pattern which is a sign of bearishness in the counter," said Palak Kothari, Research Associate, Choice Broking.
"The index has been trading below 21*50-Days Simple Moving Averages indicating southward direction for the upcoming session. However, the momentum indicator STOCHASTIC is trading with a negative crossover on a daily Charts which indicates downside movement can be seen. The Nifty may find support around 16300 levels, while on the upside 16600 may act as an immediate hurdle for the index. On the other hand, Bank nifty has support at 33800 levels while resistance at 36000 levels," Kothari added.