Nifty Consolidates Near 24850 on July 31, 2024 as Investors Await FOMC Outcome
The Indian stock market ended the trading session on July 31, 2024, with the Nifty consolidating near the 24850 mark. The index faced resistance at the 25000 level and closed with marginal gains, indicating some uncertainty in the near term.
The Nifty had a trading range of 550 points in the last two trading sessions, but the eventual gain at close was only three points. The index made a high of 24971 on Tuesday, which will now act as the first barrier for the index to cross.
The short-term trend of the Nifty remains choppy, but the near-term trend remains intact. The overall chart pattern suggests some more consolidation or a minor dip in the next 1-2 sessions before a bounce from the lows. The immediate support for the index is placed around 24700, which if breached, could lead to a pullback move towards 24570.
On the higher side, a breakout above the 25000 mark will indicate a continuation of the uptrend towards 25065 and 25330. However, experts believe that 25000 will be a challenge for the bulls, and only a sustained move above that level will begin the next leg of the rally.
The global event of the FOMC meet, which concludes on Wednesday, may have a short-term impact on the market if global markets react to the outcome of the event. The Nifty is likely to remain range-bound, but if it fails to cross 24970 in the next session, selling on the bounce could be a strategy for capturing the short-term moves.
The Bank Nifty also faced resistance from a falling trend line placed near 52300 levels. The index has formed a shooting star pattern for the second consecutive day and remained below the 23.6% Fibonacci retracement level. 52000-52300 will serve as a resistance zone for Bank Nifty, while on the downside, 51000 will act as strong support.
Technically, the Nifty on a daily scale has formed a ‘doji’ like candle, indicating uncertainty. Immediate support for the index is placed near 24770, followed by 24600.
The market is also awaiting the announcement of India’s infrastructure output for the month of June on July 31, 2024. Several companies, including Adani Power, Ambuja Cement, Bank of Baroda, BHEL, Coal India, Maruti Suzuki, and Tata Steel, are scheduled to announce their Q1 results on the same day.
Despite the consolidation, the Nifty has gained 3.5% since the start of July, making it a volatile month for the index. Foreign institutions remained net sellers in the cash market on Tuesday, while domestic institutions continued to be net buyers.
