Bulls failed to remain in control of D-Street but managed to defend 15,000 on the Nifty on May 15 which is a positive sign. The S&P BSE Sensex failed to hold on to 50,000 towards the close which suggests investors preferred to book profits at higher levels.
The S&P BSE Sensex fell 290 points to 49,902 while the Nifty50 closed 77 points lower at 15,030 levels. Broader market indices outperformed – the S&P BSE Midcap index rose 0.5 percent, and the S&P BSE Small-cap index closed with gains of 0.3 percent.
The market took a breather after the recent surge and lost nearly half a percent. But, experts firmly believe in the projected recovery in COVID cases, and the resumption of economic activities.
“An early sign of contraction in daily caseload has certainly emboldened investors, which also indicates that assumption of the second wave of COVID-19 daily caseload peaking out by the end of May or mid of June holds true,” Binod Modi, Head Strategy at Reliance Securities said.
“Any adverse impact of second-wave should not be felt beyond 1QFY22. As of now, we maintain our 2021 Nifty target at 16,300,” he said.
Amongst the sectors, profit-taking was witnessed in banking, metal, and auto whereas realty, healthcare, and power ended with decent gains. Amid all, the market breadth was inclined marginally on the positive side.
“Realty stocks like Oberoi Realty and Godrej Properties were positive on hope that demand will be back after pandemic cases fell to below 1,000 in the Financial Capital Mumbai,” Mohit Nigam, Head – PMS, Hem Securities said.
“Many stocks declined sharply during the lockdown period and can see positive momentum in case of lifting lockdown,” he said.
Here’s what experts think that investors should do on Thursday:
Sumeet Bagadia, Executive Director at Choice Broking
Technically, the Nifty index has faced resistance from the upper band of Bollinger, which indicates downside movement for the upcoming session.
Moreover, the recent candle also formed like a Shooting Star Candlestick on the daily chart, which is a sign of some correction.
Hourly Oscillator Stochastic has indicated negative crossover, which supports the short-term correction in the near term. At present, the Nifty index is holding support at 14,940 levels while an upside resistance seen at 15,200 levels.
Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas.
The Nifty had crossed multiple parameters including the psychological level of 15,000 on May 18. On the higher side, it had halted near the 78.6% retracement of the Feb – Apr decline i.e. 15,160.
The index is seeing a minor degree dip and is coming down to retest these parameters, which are now expected to act as supports as per the principle of Role reversal.
Also, with this dip, the Nifty is filling up a gap of 15,043-14,938. It has partially filled the gap and has room on the downside to fill it completely.
In the near-to-the lower end of the gap, the index is likely to attract a fresh round of buying. So buy on dips is the preferred strategy from a short-term perspective.
Manish Hathiramani, Proprietary Index Trader and Technical Analyst, Deen Dayal Investments
The index is facing resistance at higher levels. In the last couple of instances, the Nifty has crossed 15,000 with gusto and has turned back from there. If we can sustain above the 15,150 level, we will break out on the upside and climb towards 15,400.
On the downside, there is good support at 14,700 and as long as that is holding, the market trend remains positive. If we break 14,700 on a closing basis, we will drift downward to 14,400.
Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services Limited
Technically, Nifty formed a Bearish candle on a daily scale and negated its higher highs – higher lows formation of the last two sessions.
Now, it has to hold above 14,950-15,000 zones to witness an up move towards 15,200 then 15,350 zones while on the downside support exists at 14,900 and 14,800 zones.
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