Market expert Ajit Nayak from HDFC Securities has highlighted that the Nifty index is currently trading near a critical resistance level at 23,450. Following a gap-down opening and a sharp decline in the previous session, the index has managed to reclaim the 23,100 mark and is attempting to move higher.
Nayak pointed out that the gap-down resistance from the previous session remains a significant obstacle. He stated that once this resistance absorbs all sellers' bid orders, the Nifty could advance towards the 23,560 to 23,600 range. However, he advised investors to remain cautious ahead of the upcoming policy announcement, as he does not foresee an extended rally beyond the 23,700–23,750 zone.
Ajit Nayak also noted that the benchmark index is likely to remain range-bound in the near term, fluctuating within a band of 23,200 to 23,650. On the stock-specific front, he identified Federal Bank as a promising trading opportunity, with a potential upside move if it crosses the 301 level, while maintaining support at 291.
“The gap resistance is very crucial and it is absorbing all the sellers' bid orders. So, once it does that, then we can see Nifty heading towards 23,560 to 23,600 odd level.”
Ajit Nayak, HDFC Securities
The automobile sector continues to show strength, with both large manufacturers and mid-cap auto companies displaying improving technical structures. Nayak highlighted Mahindra & Mahindra, Bajaj Auto, and Jamna Auto as attractive opportunities within the sector.
With the policy announcement imminent and markets trading near key resistance levels, investors are expected to closely monitor macro developments and sector-specific opportunities, particularly within banking and automobile stocks.
Background
The Nifty index has been experiencing fluctuations due to market volatility and external economic factors. Resistance levels are critical for traders to assess potential market movements, especially with upcoming policy announcements that could influence investor sentiment.
Investors should keep an eye on the upcoming policy announcement and its potential impact on market movements, especially in light of the current resistance levels faced by the Nifty. The banking and automobile sectors remain areas of interest for traders seeking opportunities.
