Weekly Market Outlook for 20 May to 24 May

 In the week gone by, the market continued with its volatile movement but the index recovered smartly from the weekly expiry session low of 22055 and rallied sharply to end the week just above the 22500 mark with weekly gains of over a couple of percent.

Nifty formed a support base recently in the 21900-21800 range and witnessed a rebound from those levels. The volatility continued to remain high during the week, but the mid-week dip during the weekly expiry session got bought into and the index then resumed its uptrend. The RSI on the daily and the weekly charts are positive and hence, the momentum remains positive. FIIs still have more short positions in the index futures as their ‘Long Short Ratio’ is around 28 percent. If the uptrend continues, then they could look to cover these shorts which would be positive. Although Nifty is still below its swing high, the broader markets have been rallying higher and hence, the midcap and the smallcap index have been forming new record highs. The immediate support for Nifty is placed around 22300 and any dips should be seen as a buying opportunity. On the higher side, the index could attempt to rally towards new record highs soon.

                                            Nifty resumes uptrend amidst higher volatility

Therefore, traders are advised to focus on stock-specific actions and keep an eye on the development of option chain data, earnings numbers, as well as global events such as geopolitical tensions, the dollar index, bond yield movements, and commodity prices.

Nifty, Bank Nifty Levels and  FINNIFTY Levels: