Market Outlook for 05 March 2024

Nifty started the first day of the week around 22400 and traded within a narrow range throughout the day. The index ended around the opening levels itself, thus forming a small ‘Doji’ candlestick pattern on the daily chart.

Nifty Today:

After a time wise corrective phase for about a month, our markets resumed the positive momentum during last week post the GDP data. The index remains in an uptrend but if we look at the stock specific action, many stocks within the midcap and the small cap names have been going through a corrective phase. The broader trend remains positive as the index has continued to move higher, the RSI is positive and the index trades above the moving averages as well.

However, the immediate support is placed a bit lower around 22200 where the average support is seen on the lower frame chart and the open interest in the derivatives segment is highest at 22200 put option. Hence, for the index one should trade with a buy on dip approach while stock specific opportunities could provide better opportunities. One notable data also was the advance decline ratio in the NSE which was more in favor of declines inspite of index trading at highs. Thus, one should be very selective in stock picking as well.

                                          Nifty consolidates at higher level, but trading above all supports 

The Nifty Midcap 500 index which resembles the broader market movement, has also managed to form a support around its 40 DEMA and has resumed the uptrend. Amongst other sectoral indices, the Metal index has shown signs of relative outperformance which could continue in the near term.

Nifty, Bank Nifty Levels and  FINNIFTY Levels: