India’s benchmark indices Sensex and Nifty 50 are likely to open on a cautious note amid mixed global market signals and weak domestic sentiment following the new Hindenburg report against Sebi Chairman Madhabi Puri Buch in the Adani Group case.

The trends in Gift Nifty also point to a slightly negative start for the Indian benchmark index. The Gift Nifty was trading at around 24,362, a discount of almost 40 points from the previous close of Nifty futures.

The stock market is expected to react to the recent investigation report by US-based short-seller Hindenburg Research against Adani Group and Sebi Chairman Madhabi Puri Buch, which has strongly refuted all allegations, calling them “malicious”, “baseless” and “devoid of any truth”.

On Friday, domestic stock indices each closed more than one percent higher, led by a rally among index heavyweights.

The Sensex rose 819.69 points or 1.04% to close at 79,705.91, while the Nifty 50 was 250.50 points or 1.04% higher at 24,367.50.

Nifty 50 formed a small candlestick with minor upper and lower shadow and a gap-up opening on the daily chart.

“Nifty is currently on the verge of key resistance at around 24,350-24,380, which is the lower end of the previous sharp downside gap of August 5. Therefore, a further upside move from here could potentially lead to the said gap being completely filled at around 24,690,” said Nagaraj Shetti, senior technical research analyst at HDFC Securities.

He believes the few session range is now on the verge of an upside breakout. A decisive move above 24,450 could pull Nifty 50 towards the next hurdle of 24,700 in the near term, he added.

Here’s what you can expect from Nifty 50 and Bank Nifty today:

Nifty OI data

Nifty put options analysis shows significant open interest (OI) at the 24,000 level, suggesting possible support there. On the call side, notable OI concentrations are observed at the 24,800 and 25,000 levels, said Mandar Bhojane, technical research analyst at Choice Broking.

He advises traders and investors to look for buying opportunities during Nifty dips and use appropriate stop-loss strategies below the identified support levels.

Nifty 50 Prediction

Nifty 50 witnessed a sustained uptrend of 250 points on August 9 and closed near the day’s high.

“The weekly chart shows a bearish gap at higher levels, indicating weakness, yet there is also some buying interest at lower levels. On the daily chart, after Monday’s sell-off, prices have been trading in a defined range of 24,000-24,400 all week. The upper end of this range corresponds to the 20 EMA (Exponential Moving Average) and the bearish gap, while the lower end coincides with the 50 EMA,” said Rajesh Bhosale, Equity Technical Analyst at Angel One.

Looking ahead to this week, he believes momentum could be sparked if prices break out of this area. In his opinion, a breakout above 24,400 – 24,450 could spark optimism and potentially close the recent gap at 24,700.

“However, given the ongoing global uncertainty, any recovery could be an opportunity to reduce long positions. On the downside, support is seen at 24,100-24,000 and a break below this area could lead to further declines in the near term,” Bhosale said.

“Traders should closely monitor these levels and plan their trades accordingly. It is also advisable to focus on stock-specific actions and take a selective approach. Since market moves have been primarily driven by global signals, it is important to stay updated on these developments as well,” he added.

VLA Ambala, co-founder of Stock Market Today, noted that although the RSI for the daily time frame has cooled down, the readings for the higher time frames are still elevated, as evident by the reading of 68 on the weekly time frame and 75 on the monthly time frame.

“My analysis suggests that there may be scope for correction in the next 4-7 days. Nifty can expect support levels between 24,320 and 24,260 in the next session and face resistance around 24,440 and 24,530,” Ambala said.

Bank Nifty Forecast

The Bank Nifty Index gained 327.80 points or 0.65% to close Friday’s session at 50,484.50.

“For Bank Nifty, 50,000 would now be the immediate reference point for the bulls. Above 50,000, it could again rise to 50,800 and the 50-day SMA or 51,200. On the other hand, an upside below 50,000 would be vulnerable. Below that, we could expect 49,700-49,500,” said Amol Athawale, VP-Technical Research, Kotak Securities.

Disclaimer: The views and recommendations expressed above are those of individual analysts or brokerage firms and not of Mint. We advise investors to seek advice from certified professionals before making any investment decision.