Nifty Outlook for 2 June 2023

The benchmark indices consolidated within a range on the weekly expiry day, but witnessed some selling pressure towards the end and closed below 18500 with a marginal loss of about a quarter of a percent. The Bank Nifty index traded with a negative bias throughout the day and underperformed to end with a loss of over 300 points.

Nifty Today:

Although we had a positive opening for the week, the indices have not shown a follow up buying and have consolidated within a range in last few days. However, the broader markets have continued the momentum and the Nifty midcap index has continued its corrective move. Now, although this indicates that the broader trend is positive, the momentum readings on the Midcap index have reached the overbought zone. The RSI Smoothed oscillator on the daily chart on Bank Nifty index has also given a negative crossover and prices are trading around its 20 DEMA which has not yet been breached in last couple of months. A break below this average support in Bank Nifty at 43680 will indicate possibility of a short term correction within an uptrend and hence, traders should keep a close watch on the given level. In Wednesday’s session, FIIs unwound some long positions in the index futures segment which is also a sign of some profit booking. The immediate resistances for Nifty are seen around 18580 and 18630 and a move above these resistance will hint at a continuation of the uptrend. However, any profit booking hereon could lead to a pullback again towards the 20 DEMA support which is now placed around 18320.

                                                               Signs of Profit Booking as Midcap Index enters Overbought Zone

Traders are advised to trade with a stock specific approach and look for booking profits too. 

Nifty, Bank Nifty Levels and FINNIFTY Levels:

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