Technical pullback seen for battered Sensex, Nifty
Gifty Nifty indicates a positive head start for domestic markets on Wednesday amidst global recovery. Gifty Nifty at 23,150 signals a gain of about 50 points for Nifty.
Market sentiment turned cautious after US President Donald Trump announced trade tariffs on neighbouring countries, creating uncertainty around global trade dynamics. This move fueled concerns over potential disruptions in international trade, leading to a pullback in domestic equities.”
Analysts expect a technical pullback due to the oversold condition. However, they added, the market will remain volatile until the Budget presentation. Finance Minister Nirmala Sitharaman will unveil the 2025-26 Budget in February.
Equities across the Asia-Pacific region were up early Wednesday following a strong overnight closing in the US. However, Chinese markets were down sharply on reports of a fresh tariff by US President Trump.
Om Mehra, Technical Analyst, SAMCO Securities, said: The broader structure of lower highs and lower lows remains intact, indicating the continuation of the downtrend. Nifty also slipped below its 9-day EMA, suggesting weakening short-term momentum.
“The index’s falling intensity was highlighted by a sharp rise in volatility, as the India VIX surged 3.90% intraday, closing at the 17.06 level. Notably, the VIX spiked nearly 18% in January, signaling heightened market uncertainty. The daily RSI tilted further downward now hovering near the 35 level, reflecting diminishing strength. The support is positioned at 22,800 and the primary trend remains decisively bearish,” he said
At this juncture, bottom fishing should be avoided as the market remains vulnerable. He advised that it is prudent to wait for clear signs of stabilisation or reversal.
Rajesh Bhosale, Technical Analyst, Angel One Ltd – Angel One, said It turned out to be a disappointing session for the bulls, as hopes of recovery, following a brief pause in bearish momentum over the last few sessions, were dashed with the bears regaining control. The markets faced a broad-based sell-off, underperforming compared to global peers. Despite the strong grip of bearish momentum, the session was marked by sharp, volatile swings on both sides. Given the severity of the sell-off, the ongoing weakness is likely to persist,
