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The equity market has entered the all-important week, wherein the focus will be on the US Fed meeting outcome, on an optimistic note. The Sensex and the Nifty were seen quoting at new life-time highs amid expectations that the US Fed will cut interest rates for the first time since March 2020 this week.
The US Fed policymakers will meet on September 17-18, and shall announce their policy decision on Wednesday night. Market watchers expect the US Federal Reserve to cut rates by at least 25 basis points (bps) this week as the latest government data revealed that US inflation cooled for the fifth straight month and rose less than expected in August 2024.
Apart from the US Fed's meeting, the central bank meetings of Japan and the Bank of England will also be on investors' radar. Last week, the European Central Bank cut interest rates for the second time in three months.
Back home, the Reserve Bank of India policy meeting is scheduled for October 7-9.
The markets are expected to be volatile in the short-term given the uncertainty around the quantum of the US Fed rate cut and the follow-up commentary. Against this backdrop here are the key levels to watch out for on the key benchmark indices.
Sensex
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Current Level: 83,127
Upside Potential: 2.1%
Support: 82,725; 82,365
Resistance: 83,750
Last week, the BSE Sensex cleared its key hurdle at 82,725 and rallied to newer heights, thus dismantling the short-term bearish overhand in the market. Going ahead, the near-term bias for the Sensex is likely to remain positive as long as the index holds above 82,365 levels; with interim support likely at the previous resistance point.
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On the upside, the Sensex can potentially rally to 84,865 levels; with interim resistance seen at 83,750. On the flip side, break and sustained trade below 82,365, can trigger a 1,000-point slide.
Nifty
Current Level: 25,425
Upside Potential: 1.5%
Support: 25,250; 25,150; 24,750
Resistance: 25,500; 25,550
The NSE Nifty 50 index was seen quoting at a new all-time high for the second time in the last three trading sessions. More importantly, on the weekly scale, the Nifty managed to negate the 'Bearish Engulfing' pattern formation with a 'Bullish Engulfing' pattern last week. Thus, the near-term bias has once again turned favourable.
The Nifty 50 seems on course to test the 25,500-25,550 resistance zones; above which a rally towards 25,800 seems likely. The primary concern for the Nifty remains negative divergence seen in key momentum oscillators such as the RSI (Relative Strength Index) and MACD (Moving Average Convergence-Divergence) which have not seen higher highs even as the Nifty scaled new highs.
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The overall chart pattern indicates that the bias is likely to remain positive as long as the index holds above 24,750 levels; with near support seen at 25,250 and 25,150 levels. CLICK HERE FOR THE CHART
Nifty IT
Current Level: 43,400
Upside Potential: 5.8%
Support: 42,830; 42,350
Resistance: 43,990; 44,730; 45,330
The NSE Nifty IT index scaled a new summit at 43,583 in opening trades on Monday, and thereafter slipped into the negative zone. The price-to-moving averages action remains favourable for the tech-laced index.
The long-term chart suggest that the Nifty IT index is likely to exhibit bullish bias as long as the index holds above 42,830 levels; below which support for the index is seen at 42,350. On the upside, the IT index can potentially surge to 45,930 levels; with interim resistance likely around 43,990, 44,730 and 45,330 levels. CLICK HERE FOR THE CHART
Bank Nifty
Current Level: 52,130
Upside Potential: 2.9%
Support: 52,050; 51,750
Resistance: 52,340; 52,660
The Bank Nifty has recently given a breakout on the daily scale. The index is likely to exhibit a bullish bias as long as it holds above 52,050 levels; below which key support for the index is seen at 51,750.
On the upside, the Bank Nifty seems on course to test the higher-end of the Bollinger Bands on the weekly scale at Rs 53,640 levels; with interim resistance likely at 52,340 and 52,660 levels. CLICK HERE FOR THE CHART
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