Nifty, Sensex, Nifty Bank outlook for today: GIFT Nifty down 80 points; key levels to watch

Indian equity benchmark indices are set to open little changed on Tuesday, after hitting six-week lows in the previous session, as the broader market undertone ​remained subdued due to rising crude prices on risks of a ‌widening Middle East conflict. Iran threatened that any new attacks on Tehran will be met with a retaliation on US assets, including US oil ​and gas interests, was vulnerable.

Despite mixed Asian market cues, local investors reduced their equity exposure due to worries about a fresh escalation in US-Iran conflict. Elevated US bond yields have once again fuelled foreign fund outflows from domestic equities, which is also weighing on the sentiment, said Ankur Punj, Managing Director at Equirus Wealth.

GIFT Nifty, Asian markets & US stocks
GIFT Nifty Futures on the NSE International Exchange were 79.70 points, or 0.33 per cent, down at 23,788, hinting at a weak start for the domestic market on Tuesday. Asian markets struggled for direction as a mixed batch of regional economic data ‌and fresh Iranian threats in the Persian Gulf drove oil prices. KOSPI rose nearly 1.5 per cent, while Nikkei edged higher. Hang Seng fell nearly a per cent.

Wall Street dipped ​on Friday as a robust jobs report raised the probability that the US Federal Reserve will increase key interest ‌rate at this month's monetary policy meeting. The Dow Jones Industrial Average fell 272.51 points, or ‌0.51 per cent, to ⁠53,413.60, the S&P 500 lost 29.30 points, or 0.38 per cent, to 7,718.41 and the Nasdaq Composite shed 77.07 points, or 0.29 per cent, to 26,506.99.

Crude, US dollar, gold & more
Oil prices moved higher for a third day as trading resumed in Asia, with Brent crude futures edging up 0.04 per cent to $97.04 a barrel, after Iran threatened to retaliate against any new attacks by targeting energy infra. The US dollar index was trading around a two-week low of ​98.82. Gold was up 0.5 per cent at $4,428.23, while bitcoin nudged 0.1 per cent higher to $79,333.01.

The fall was primarily driven by weak global cues amid expectations of a possible US rate hike following stronger-than-expected job data, weighing on IT stocks and overall market sentiment, said Ajit Mishra, SVP of research at Religare Broking. "We recommend continuing with a 'sell on rise' approach, while staying selective on the stock-specific front and focusing on strict risk management."

FII-DII flows
Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 280.13 crore on Monday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 566.76 crore on a net-net basis.

Nifty50, Sensex & India VIX outlook
The market is consistently facing selling pressure at higher levels. A bearish candle on daily charts and a lower top formation on intraday charts indicate further weakness from the current levels, said Shrikant Chouhan, Head of Equity Research at Kotak Securities.

"23,850/76,300 would act as a key resistance zone. Below this, a correction wave is likely to continue. On the downside, the market could slip to 23,670 -23,600/76,000-75,600. On the flip side, above 23,850/76,300, a pullback could continue till 23,950-24,000/76,500-76,700," it added.

Nifty is also consolidating below a falling 50 EMA, pointing towards a strengthening bearish trend. The momentum indicator RSI is falling deeper into the bearish zone, confirming weak momentum. In the near term, the weakness may continue, with it potentially declining towards 23,700/23,620. On the higher end, resistance is placed at 23,900, said Rupak De, Senior Technical Analyst at LKP Securities.

The RSI stands at 34, sliding closer to oversold territory. India VIX settled at 11.14, up 4.31 per cent, indicating volatility ticked higher amid the decline, said Om Mehra, Technical Research Analyst at SAMCO Securities.

Nifty Bank outlook
Nifty Bank has remained range-bound, reflecting the absence of a clear directional trend. The momentum indicators and oscillators point towards a sideways market structure, said Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities. "The 57,500-57,600 zone is likely to act as an immediate resistance area. On the downside, the 56,800-56,700 zone remains an important support."

Nifty Bank formed a bearish candle with a lower high and a lower low signaling continuation of the corrective decline. It is seen trading in the 57,000-58,000 range in the immediate short term. The broader consolidation range remains intact between 56,500 and 58,700. It may extend the consolidation and only a breakout or breakdown will signal a directional momentum, said Bajaj Broking.

"Within the consolidation index is facing resistance around 58,000 levels. Index sustaining above 58,000 levels will open upwards towards 58,500-58.700 levels. Failure to sustain above 58,000 levels will signal extension of range bound trade in the range 57,000-58,000 levels in the coming sessions," it added.