Nifty trapped between 23,300 and 23,850: Anil Singhvi shares key breakout levels

Indian stock market benchmark indices Sensex and Nifty 50 are set to open lower on Wednesday tracking weak global cues and rising concerns over inflation, high bond yields and geopolitical tensions.

Asian markets traded in the red while Wall Street ended lower overnight as rising US Treasury yields hurt investor sentiment. Concerns over lack of peace breakthrough between the US and Iran also kept risk appetite under pressure.

The Sensex fell 114.19 points, or 0.15 per cent, to close at 75,200.85, while the Nifty 50 declined 31.95 points, or 0.14 per cent, to settle at 23,618.

What is worrying the market?

According to Zee Business Managing Editor Anil Singhvi, traders are closely watching several factors on Wednesday.

The sharp fall in GIFT Nifty has raised concerns over a gap-down opening. Investors are also tracking Donald Trump’s latest remarks on Iran, rising crude oil prices, weakness in the rupee, and fresh selling by foreign institutional investors (FIIs) after three sessions of buying.

Singhvi highlighted that the rupee hitting a fresh lifetime low remains a key concern for the market. At the same time, strong domestic institutional buying and resilience in midcap and smallcap stocks continue to provide support.

Nifty stuck in a narrow range

The Nifty 50 has remained range-bound for the past six sessions. The index has been taking support in the 23,300–23,425 zone, while facing resistance around 23,700–23,850.

Over the last four sessions, the Nifty has largely closed in the 23,600–23,700 band, signalling indecision in the market.

Singhvi believe a close below 23,375 could trigger further weakness, with the next downside target seen in the 23,125–23,275 range.

On the upside, a decisive close above 23,700 may strengthen bullish momentum and push the index towards the 23,850–24,000 zone.

Key support near unfilled gap zone

Singhvi noted that the Nifty had left a major gap between the April 7 high and April 8 low. Since then, the gap near 23,153 remained partially unfilled.

The 23,125–23,300 range is now being seen as a strong support zone. Analysts believe that a bigger correction may emerge only if the Nifty closes below 23,100.

Bank Nifty shows signs of stability

The Bank Nifty remained range-bound on Tuesday. The index touched a high of 53,770 and a low of 53,337, with an intraday range of just 433 points — the narrowest in the past three months.

Despite recent consolidation, analysts said Bank Nifty has strong support in the 52,600–52,800 zone.

The banking index had also filled its April gap after touching a low of 52,783 on May 18. Following the gap fill, Bank Nifty witnessed a sharp recovery of nearly 1,000 points in two sessions.

According to Singhvi, fresh weakness may emerge only if the index closes below 52,500.

Power stocks remain in focus

Power sector stocks are expected to remain in focus after India’s power demand touched a fresh all-time high.

The country’s power demand hit a record 260.5 GW at 3:40 PM on Tuesday, surpassing the previous record of 257.37 GW set a day earlier.

Singhvi believe rising temperatures and heatwave conditions could further increase electricity demand in the coming weeks.

Most of the additional demand is expected to be met through thermal power generation, while solar, wind, and hydro capacity additions may also accelerate. Market experts believe power stocks may continue to witness buying interest on declines.

Will the IT rally pause?

The Nifty IT index extended gains for the third consecutive session and climbed 3.2 per cent to close at 29,308 on Tuesday.

The index touched an intraday high of 29,609, its highest level in nine sessions, and has rallied nearly 7 per cent in the last three trading days.

However, Singhvi warned that the IT index has now entered a major resistance zone between 29,600 and 30,000, where profit booking could emerge.

The index has failed to cross the 30,000 mark multiple times since April 24. Singhvi also pointed out that the index has completed a 50 per cent retracement of its recent fall at around 29,606, while its 50-day moving average is placed near 29,735.

Singhvi said a fresh bullish breakout may happen only if the IT index closes decisively above the 30,000 level.