Nifty 50 Faces Key Support at 23,500, Bank Nifty Awaits Direction at 54,000

Nifty 50 and Bank Nifty Outlook: Consolidation Expected Amid Ongoing Market Volatility

The Indian equity market is expected to consolidate further, with the Nifty 50 facing resistance at 23,800 and 24,000, and support at 23,500 and 23,400. Meanwhile, the Bank Nifty needs to defend the 53,800-53,700 zone for a rebound towards 55,200.

On May 29, the Nifty 50 plunged 359 points (1.50 percent) to 23,548, while the Bank Nifty fell 615 points (1.12 percent) to 54,239. Market breadth remained dominated by bears, with about 2,081 shares declining against 925 advancing shares on the National Stock Exchange.

Market Outlook and Analysis

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Aditya Thukral, Founder & Analyst of AT Research & Risk Managers, believes that the Nifty 50 has been sustaining below all major exponential moving averages and has also closed below short-term moving averages. The index is still forming a lower-high and higher-low structure within the broader range of 23,250 and 24,500, indicating a sideways market.

Rajesh Palviya, Senior Vice President Research (Head of Research) at Axis Securities, notes that the Nifty ended the week with a loss of 171 points. For the third consecutive week, the benchmark index remained range-bound within the 23,300-24,000 zone, reflecting a lack of decisive momentum on either side. A breakout from this range is likely to determine the next directional move.

Anshul Jain, Head of Research at Lakshmishree Investments, believes that the Nifty ended the week with a bearish Dark Cloud Cover pattern on the weekly chart, rejecting the two-week high near 24,000 and signalling the emergence of supply at higher levels. Despite the bearish formation, bulls successfully defended the weekly lows, preventing a breakdown and keeping the broader structure range-bound.

Nifty 50 and Bank Nifty Key Levels

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Bank Nifty Outlook and Positioning

The banking index started declining after forming a lower high. The short-term downtrend structure remains intact, with lower highs and lower lows visible on the price chart. The index continues to trade below all major exponential moving averages, and Friday's close below short-term EMAs could trigger a fresh round of selling.

Trading Strategies

Aditya Thukral recommends selling Nifty Futures on a rise towards 23,800 with a stop-loss at 23,900, targeting 23,600.

Rajesh Palviya suggests buying Nifty Futures around 23,700 with a stop-loss at 23,550, targeting 23,900-24,000.

Anshul Jain advises buying Bank Nifty Futures above 54,500, targeting the 54,800-55,000 zone, with a stop-loss below 54,000.

Key Takeaways

• The Nifty 50 and Bank Nifty are expected to consolidate further amid ongoing market volatility.
• The Nifty 50 faces resistance at 23,800 and 24,000, and support at 23,500 and 23,400.
• The Bank Nifty needs to defend the 53,800-53,700 zone for a rebound towards 55,200.
• Market breadth remains dominated by bears, with about 2,081 shares declining against 925 advancing shares on the National Stock Exchange.