The Indian stock market witnessed a turbulent start to the new financial year, with investors losing over Rs 4 lakh crore on April 1. The BSE Sensex plummeted by 1,390 points, closing at 76,000 levels, while the NSE Nifty 50 index fell by more than 350 points to settle at 23,165. The India VIX, a critical measure of market volatility, surged 10.5% to 13.93, reflecting heightened investor nervousness. As traders prepare for the next trading session on April 2, the question remains: Will the downtrend persist, or is a recovery on the horizon?
Technical Analysis and Key Levels
Market experts suggest that the downward momentum may continue unless Nifty decisively reclaims key resistance levels. On the technical front, Nifty found support near its 100-Day Exponential Moving Average (100-DEMA) at approximately 23,400, forming a red candle on the daily chart. However, the weekly chart indicates a doji pattern, signaling uncertainty in the market’s direction.
According to analysts, Nifty faces strong resistance in the 23,800–23,810 range. A breakout above this level could pave the way for a rally toward 24,000–24,080, where the 200-Day Simple Moving Average (200-DSMA) is positioned. Conversely, if the index falls below 23,400, further weakness may push it towards 23,200-23,000 levels.
For Sensex, 75,800 serves as a crucial support zone. A sustained move above this level could trigger a rebound toward 76,500-76,650. However, a drop below 75,800 might increase selling pressure, potentially dragging it down to 75,500.
Market Strategy for Traders
Given the current volatile market texture, a level-based trading approach is recommended for traders. Market participants should adopt a cautious approach, focusing on key support and resistance levels to navigate the fluctuations effectively.
- Nifty traders should closely watch the 23,800 resistance level. A decisive move beyond this point could signal a short-term recovery.
- If Nifty breaks below 23,100, sentiment may deteriorate further. This could lead to increased selling pressure and further downside.
- For Sensex, a move above 76,500 may indicate a potential recovery. On the other hand, a fall below 75,800 could extend the bearish trend.
- Bank Nifty has formed a bearish pattern, indicating extended profit booking. This suggests continued weakness in banking stocks.
- IT stocks remain under selling pressure, with the sector expected to underperform in the near term. Traders should exercise caution while dealing with IT-heavy portfolios.
Sectoral Outlook and Investor Sentiment
The overall market sentiment remains weak, particularly in the IT sector, where selling pressure is evident at key resistance levels. Other blue-chip stocks also faced intense selling, contributing to the sharp decline in indices. Investors should stay informed and manage risk effectively in the current uncertain environment.
As the market opens on April 2, traders should remain vigilant of global cues, institutional flows, and key technical levels. Whether the market stabilizes or continues its downward trajectory will depend on how major indices respond to these critical price zones. Adopting a disciplined and data-driven approach will be crucial in navigating the ongoing market volatility.
