31 July 2019 (8:44 am IST)
Today, SGX Nifty is down by 40 points in early trading and if Indian stock markets follow this lead, then we can expect a big gap down opening in Nifty and these markets too.
Indian stock markets are in a very strong downtrend and no one can say, how long this fall will continue as Indian economy sinks and businesses start getting affected.
Yesterday, Nifty breached another support, this time of 11,100. We have been writing that Nifty will go down to 11,000 at this rate and now that level is hardly a 100 points away. We had also written that if the downtrend continues with this strength, Nifty could go towards 10,000 level.
For intraday support and resistance, use pivot levels given on our Pivot Trading page. For major indexes these levels are:
- Intraday Bank Nifty Pivot levels
- Intraday Nifty Pivot levels
- Intraday Nifty IT Pivot levels
- Intraday Sensex Pivot levels
On June 03, Nifty had closed above 12,000. In just a few weeks, the index has lost 1,000 points. There is no guarantee that it will not lose another 1,000 points, or more.
For investors, this is a wonderful opportunity to invest via SIP (Systematic Investment Plan). For day traders, this is not a market to look for technical support or even think of buying.
In the previous session, Bank Nifty lost 500 points and Nifty a hundred points. Even after that, SGX Nifty showed no signs of improvement and this futures index of Nifty fell by another 50 points during the opening trade in US stock markets. That loss has not been recovered in this mornings session which is another indication of the current strong downtrend.
Today, we will again watch which levels will act as minor support and which as major resistance. Every previous support is quickly turning into a new resistance for Nifty. So now, 11,100- 11,150 will be Nifty’s new resistance levels.
The next support for Nifty comes near 11,018 which is 20-Day Moving Average on monthly charts (middle band of Bollinger Band). In case of a big gap down opening, Nifty will open near this level and that may cause choppiness in the index and broader markets. If Nifty finds support after a lower opening, then markets will become rangebound between today’s opening and yesterday’s closing levels.
If Nifty breaks this support of 11,000, then this index will head towards the lower band of Bollinger Band indicator which comes near 10,000.
Expect Indian stock markets to continue their current strong downtrend. The last hope of support is 11,000 level in Nifty but that is only a technical level, Ground realities are not in favor of any recovery in these markets.