Supports Respected! Nifty Closes Above 19,400 - Post-Market Analysis

NIFTY started the day at 19,383 with a gap-down of 44 points. Within just 10min of opening, the index fell nearly 130 points to 19,260— breaching the support zones of 19,300. After the fake breakdown, Nifty moved up sharply by nearly 200 points throughout the day to 19,460 levels. Nifty closed at 19,434, up by 6.25 points or 0.03% 

BANK NIFTY (BNF) started the day at 44,066 with a small gap-down of 132 points. In the first 10min, the index fell over 300 points to 43,770 levels. It then slowly moved up to 44,200 levels— a rally of more than 430 points from the day’s low. BNF closed at 44,090, down by 108 points or 0.24%. 

All other indices except Nifty Media (+0.8%), Nifty IT (+0.68%), and Nifty FMCG (+0.49%) closed in the red. Nifty Metal (-2.1%) fell the most. 

Major Asian markets closed in the red. European markets are currently trading mixed.

Today’s Moves

LTIMindtree (+1.68%) was NIFTY50’s top gainer on the back of strong volumes.

Olectra Greentech (+9.59%) broke its 5-day losing streak, surging up to 10% today.

Mazagon Dock Shipbuilders (+7.6%) jumped after the company’s Chairman Sanjeev Singhal said he anticipates a strong FY25 with major order deliveries.

Adani Ent (-3.29%) was NIFTY50’s top loser. Other Adani Group stocks also fell sharply after Deloitte Haskins & Sells resigned as the statutory auditor of Adani Ports.

Nykaa (-8.14%) crashed after several brokerage firms highlighted challenges in the company’s growth in their post-earnings stock reviews. 

Markets Ahead

As mentioned earlier, the markets were weak, and a flat or gap-down opening could take the indices further down. And that’s what happened today. After the gap-down, Nifty went on to hit our target of 19,300, and Bank Nifty was in our volatile zone.

Nifty: There is strong buying from 19,300 levels, but the markets can still be bearish until the 19,500 resistance is breached. In that case, the index may turn bullish and go on to hit targets of 19,630. If today’s swing of 19,350 is breached, the index will test 19,300 again, and if that’s broken, Nifty can fall to bigger targets of 19,200 and 18,900 in the coming weeks.

Bank Nifty: The index is looking weaker than Nifty, and is still in our volatile zone between 44,500 and 43,400. Bank Nifty can continue to be volatile and hit stop losses on both sides, so wait for this range to be broken.

Finnifty: The index moved in a similar pattern as Bank Nifty today. Being expiry today, it was relatively easy for non-directional option sellers as the IV (which spiked initially) was cooling off gradually.

Meanwhile, India’s retail inflation surged 7.44% on an annual basis in July, compared to 4.81% in June. The sharp rise can be attributed to a steeper-than-expected increase in vegetable prices (especially tomatoes) over the past month.

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