Market Outlook for 04 January 2024

Nifty started the day marginally negative and traded under pressure throughout the day. It was mainly led by correction in the IT stocks which reacted to yesterday’s sharp fall in the Nasdaq index. Nifty finally ended the day tad above 21500 with a loss of about seven-tenths of a percent.

Nifty Today:

Nifty witnessed some selling pressure led by the IT stocks which reacted to the correction in the Nasdaq index. Also, post the recent run in the month of December, the RSI readings were quite overbought and have given a negative crossover from the overbought zone. Such crossover indicates a short term corrective phase within an uptrend and thus, the indices could either see a price-wise pullback move in the short term to retrace the recent upmove or a time-wise correction till the overbought readings cool-off. The index has ended around the 50 percent retracement of the last few day’s upmove which is placed around 21500. This level would be keenly watched on the weekly expiry day as a break below this could lead to some correction towards 21300-21250 in the short term. On the flipside, 21700 is the immediate resistance now followed by the swing high at 21830. 

Negative global cues led to sharp fall in IT stocks

n last couple of sessions, although the index has corrected, the broader markets have not seen any sell-off and the stock specific momentum remains positive. Hence, it’s better to trade with a stock specific approach at the moment. 

Nifty, Bank Nifty Levels and  FINNIFTY Levels: