Sensex and Nifty continued to slide down on Tuesday as bears remained in control on Dalal Street. S&P BSE Sensex tanked 567 points or 1.02% to settle at 55,107 while the NSE Nifty 50 index fell 153 points or 0.92% to end the day at 16,416. Volatility was on the rise as benchmarks fell, gaining 1% and remaining above 20 levels. Ahead of Wednesday’s trade, SGX Nifty was up with gains, suggesting a positive start for Dalal Street. Global cues were positive after Wall Street equity indices closed with gains. Investors will keep an eye on RBI’s MPC decision today and the central bank’s projections for inflation.
Global watch: On Wall Street, S&P 500 zoomed 0.95% on Tuesday, followed by a 0.94% jump by the NASDAQ index. Dow Jones gained 0.80%. Asian stock markets were up with gains during the early hours of trade with Shanghai Composite, Hang Seng, Nikkei 225, TOPIX, KOSPI, and KOSDAQ all in the green.
What do the charts say: On Tuesday, the Nifty formed a small negative candle on the daily chart with minor lower shadow, said Nagaraj Shetti, Technical Research Analyst, HDFC Securities. “Technically, this pattern signal weak trend with range bound action. Nifty is currently placed at the edge of breaking below the crucial support of 16400 levels (support as per change in polarity and daily 10 and 20 day EMA). But, minor buying is still emerging from the lows,” he added.
Levels to watch out: Ruchit Jain, Lead Research, 5paisa.com is advising traders to avoid bottom fishing and consider any up move due to the event (RBI MPC) as just a pullback move and look to lighten up longs in such up moves. “In the near term, the Nifty could test 16200-16250 range while on any pullback moves, 16550-16650 will be seen as the resistance zone,” he added. Meanwhile, Nagaraj Shetti of HDFC Securities said that the short term trend of Nifty continues to be negative. “Formation of small negative candles with lower shadows on the downside and placement of crucial supports, one may expect Nifty to witness sustainable upside bounce from the lows of 16300-16250 levels in the next 1-2 sessions,” he said.
FII and DII trades: Foreign Institutional Investors (FII) pulled out Rs 2,293 crore from domestic stocks on Tuesday. Domestic Institutional Investors (DII) were net buyers, pumping in Rs 1,311 crore.
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