Nifty Recovers from Early Slide, Holds Higher Lows Amid Rupee Weakness

Mr. Vinay Rajani, Senior Technical Research Analyst - Prime Research, HDFC Securities

For the last five trading sessions, Nifty has again slipped into an alternating pattern of one session of gain followed by one session of loss. Today, the index opened 161 points lower, hit its intraday low in the very first few minutes of trade, and then reversed course sharply. Nifty registered a smart intraday recovery of nearly 300 points from the morning low of 23,397 to finally settle at 23,659, up 41 points. NSE cash-market turnover fell by about 12% compared with the previous session.

Among index heavyweights, Hindalco, Reliance, and Bajaj Auto advanced the most, while BEL, Tech Mahindra, and Eternal emerged as key laggards. Sectoral performance was mixed, with Oil & Gas, Auto, and Realty indices logging the strongest gains, while Nifty Media, FMCG, Chemical, and IT ended in the red. The broader market moved in sync with the benchmark, with the Nifty Midcap 100 rising 0.49% and the Nifty Smallcap 100 holding in positive territory with a minor gain of 0.04%. Market breadth remained neutral, as the BSE advance-decline ratio stood at 1.07.

The rupee closed 29 paise weaker at 96.83 against the dollar, marking a fresh all-time low, with today's intraday low at 96.9650. The sharp rupee weakness likely reflects persistent FII outflows, elevated crude prices, and safe-haven demand for the dollar amid global risk-off sentiment.

Despite these negative cues, Nifty has managed to absorb supply at lower levels and is forming higher lows on a short-term time frame. Support for the index now moves up to around 23,370, derived from an upward-sloping trend line joining the recent higher swing lows. On the upside, 23,800 is a crucial resistance; a close above this level could extend the pullback towards the 50-day EMA, currently near 24,030.

Source : Equity Bulls

Keywords

Nifty RupeeWeakness HDFCSecurities