Reacting to negative global cues, the Indian market closed in the red on October 29 on the F&O expiry day. Bulls tried to push benchmark indices higher but selling pressure at higher levels pushed both Sensex and Nifty below crucial supports.
The S&P BSE Sensex failed to hold on to 40,000 while the Nifty50 closed below 11,700, but above 11,650 levels.
Let’s look at the final tally on D-Street – the S&P BSE Sensex fell 172 points to 39,749 while the Nifty50 was down 58 points to close at 11,670.
Experts are of the view that crucial support for the Nifty is placed at 11,580 for the November series while on the upside 11,750-11,850 will act as a major hurdle for the index.
“Global market is gripped with volatility on concerns over rising pandemic. On expiry day Indian market too reflected weakness with a steep rise in the VIX index that indicated near term volatility,” Shrikant Chouhan, Executive Vice President (Equity Technical Research), Kotak Securities told Moneycontrol.
“Continued volatility is bad news for day traders. Traders should be careful while trading at the resistance and support levels. Nifty arrested exactly at the corrective level of 11606 and reversed back. Although the closing was below 11700, we would say bulls have defended the major support level, which was at 11600,” he said.
Chouhan is of the view that in the coming weekly expiry, it is mandatory for the Nifty to defend the level of 11580 otherwise, we could see a deep decline to 11400 or 11300 levels. “On the upside, 11750 would be a major hurdle, if Nifty convincingly cross those levels index could move to 11850 levels,” he said.
Here is what experts have to say on what investors should do on October 30:
Sumeet Bagadia, Executive Director at Choice Broking.
Tracking the sharp downfall in the US market, the Indian market made a gap down opening as sentiment was downgraded by rising COVID-19 infections.
Though some value buying was seen in the afternoon session, but it was unable to take the market into the green territory. It was an expiry day so we saw volatility as well in the market as during the 1st half, we saw an intraday high.
During the 2nd session, Nifty riding the roller coaster made an intraday low at 11597 level and finally settled at 11670 level with the loss of 58 points. At the present level, Nifty has strong support at 11600 while upside resistance comes at 11800-11900.
Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services Limited
The Nifty index opened negative and witnessed a roller-coaster ride on the October monthly expiry day. The index formed a Bullish candle as it closed higher than its opening zones but the occurrence of a long upper shadow indicates that bears are putting sustained pressure at higher zones amid weakness in the Global markets.
The index has turned highly volatile in the last couple of sessions and got stuck in a wider range where declines were being bought while multiple hurdles are intact at 11950-12020 zones.
Now it has to cross and hold above 11750-11777 zones to get the bull’s grip for a bounce towards 11900 levels while on the downside major support exists at 11550-11500 zones.
Ajit Mishra, VP - Research, Religare Broking Ltd
We reiterate a cautious stance as there is high uncertainty in global markets due to a recent surge in COVID cases. A decline below 11,600 in Nifty would pave way for further slide.
In the case of a rebound, 11,750 would act as a hurdle. Traders should limit their leveraged positions and maintain a balanced approach.
Aamar Deo Singh, Head Advisory, Angel Broking Ltd
Overall, we are witnessing consolidation in the markets, with Nifty meeting with resistance around 11850-11900 zone whereas support is seen around 11450-11500 levels.
India VIX has gained 10% so far this week, which could become a cause of concern if this trend continues as increased volatility is likely to be witnessed ahead of the US Presidential Elections.
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