Domestic markets are likely to open flat on Tuesday amid mixed global cues. According to analysts, the technical pullback and relief rally will continue due to the oversold condition.
Gift Nifty at 23,000 signals that Nifty may open marginally down.
However, analysts said the market may recover due to a pullback rally and value buying at lower levels.
Dhupesh Dhameja, Derivatives Analyst, SAMCO Securities, said: Nifty index is transitioning from a downtrend to a sideways-to-bullish bias, having reversed its eight-day decline while consistently attracting buyers at lower supports.
Derivatives data reflects a marginally bearish bias, with call writers slightly outweighing put sellers, signalling caution among market participants. A surge in open interest at the 23,300-strike call (74.60 lakh contracts) establishes it as a key upside hurdle, he added. However, the Put-Call Ratio (PCR) improved to 0.81 from 0.70, suggesting that while bearish momentum persists, buying interest is also emerging. Meanwhile, the ‘Max Pain’ level at 23,100 hints that any dips might be cushioned despite escalating volatility, he added.
India VIX, a gauge of market fear, rose by 4.71 per cent to 15.72, reflecting a slight uptick in uncertainty. With VIX sustaining above the critical 15-mark, market sentiment remains cautiously volatile, suggesting that wild swings could persist, he further added.
Meanwhile, global stocks are mixed. Among Asia-pacific stocks, Japan and Taiwan are up in early deal while Korean and Australian stocks are down marginally.
Satish Chandra Aluri, Lemonn Markets Desk, said: Markets experienced a relief rally from lows after Nifty 50 slipped below the 22,800 levels and gains were led by Pharma, Metals, Energy and Financials while Media and IT along with Auto remained the laggards. “Technically, Nifty 50 closed below the 23,000-support level but Nifty may extend the bounce to 23,200 levels if buying interest persists with 22,800 acting as next immediate support on the downside. Bank Nifty also posted gains in today’ session and close above key 49000 level, which acts as next support,” he said.
Source: www.thehindubusinessline.com