Nifty Outlook - 6 Jan 2023

Nifty Outlook-6-Jan-2023

Market Outlook
by 5paisa Research Team Last Updated: 2023-01-09T15:52:53+05:30

The weekly expiry day started marginally positive but post initial 15 minutes of consolidation, the index corrected sharply and traded with a negative bias for most part of the day. It sneaked below 17900 at a point but recovered some of the losses in the last hour and ended the day tad below 18000 with a loss of over a quarter of a percent.

Nifty Today:

 

After failing to cross above the 20 DEMA, the indices have corrected in last couple of sessions and it breached the 18000 mark. The correction has been mainly due to FII selling as their ‘Long Short Ratio’ has declined from 57 percent at the start of January series to around 36 percent. They also have sold equities in the cash segment and a combination of FIIs selling in the cash segment along with short formations in index futures has generally been negative for the markets. However, if we look from a technical perspective, Nifty is trading around a rising trendline support and after the recent corrective phase in last one month, the momentum readings on the lower time frame charts have entered the oversold zone. Hence, it does not look to be an appropriate zone to form shorts and infact, one can take some contra trade and look for buying opportunities. The swing low of 17770 would be seen as important support and only if we break that support, then we would see the momentum accelerating on the downside. Hence, till this support is intact one can look for buying opportunities in intraday declines. 

 

Nifty approaches important support zone post recent correction

 

Market Outlook 6th Jan 2023

 

The Bank Nifty index which had outperformed in last few months witnessed a sharp correction in intraday today. We may see some stock specific moves from stocks within this sector in the near term while some of the other sectors may take the leadership in the short term. Traders are advised to look for stock specific buying opportunities in stocks which have shown relative strength in the last one week.

 

Nifty & Bank Nifty Levels:

 

Nifty Levels

Bank Nifty Levels

Support 1

17880

42220

Support 2

17770

41850

Resistance 1

18110

43060

Resistance 2

18230

43520

 

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