Nifty may remain under pressure as FPI selling continues; key levels to watch
Traders are watching the 23,300 zone closely as subdued volatility contrasts with continued weakness in the benchmark index
The Indian equity market may continue to face pressure on Wednesday despite positive global cues, as foreign portfolio investors are selling shares, according to analysts. Foreign outflows and elevated global bond yields are adding to the overhang for domestic equities, stated Ajit Mishra, SVP – research, Religare Broking. On Tuesday, FPIs sold shares worth Rs3,810 crore.
The market has become cautious, with the put-call ratio at 0.99, indicating that put options are more popular than call options. The Call OI stands at 14.53 crore contracts, while the Put OI is 12.99 crore. Analysts believe that the 23,400–23,500 range may act as immediate overhead supply, with further Call OI expected in the 23,700–24,000 range.
On the downside, Put positioning around 23,300 and 23,100 provides a cushion, making the 23,300–23,270 range an important demand zone. The India VIX declined 2.12% to 10.99, suggesting that volatility is currently subdued despite the weakness in the index. If buying above 23,500 occurs, the recovery could resume towards 23,670. However, a decisive break below 23,270 would increase downside risk towards 23,060.
The index formed a bearish candle on the daily chart, signaling selling pressure at higher levels, as Nifty snapped its 4-session up move and closed lower around 23,350. Most Asian stocks are closed for the holiday today. Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking, expects Nifty to extend its recent consolidation and trade in the range of 23,115-23,650 in the coming sessions, with 23,600-23,650 acting as major resistance.
Written by urgent.news from Hindu BusinessLine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
