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On analysis of the movements by the and its futures, I find a steep fall awaits here amid increasing uncertainty on politico-economic fronts with plethora of reports by think tanks who have presented their observations about Indian economy, results in a sudden move by the ruling majority and the opposition over the different aspects to influence the voters, especially before the next Lok-Sabha election, expected to be held in April or May 2024.
On Wednesday, the Controller General of Accounts reported the Indian fiscal deficit at Rs.17.33 lakh crore for FY23 amounts to 6.4 percent of the GDP. However, in absolute terms, it is lower than the revised estimate of Rs.17.55 lakh crore by Rs. 22,188 crore which reflects a continuation of selling pressure in Indian indices during the upcoming week amid increasing indecisiveness.
In mid-July 2023, the Nifty 50 index tested a lifetime high before starting a downward move which still continued till Friday’s closing could get the first confirmation with a gap-down opening on the first trading session of the upcoming week as the closed this week below the Nifty 50.
Undoubtedly, the weekly opening level could follow the weekly opening of the other global indices as the overall trend looks bearish. I feel that every upward move by Nifty 50 will likely to attract big bears above 19486.
In the daily chart, the formation of a ‘Bearish Crossover’ with 9 DMA crossing downward to 18 DMA on August 3, 2023, gives the first confirmation, while a downward move by the Nifty Futures below this bearish crossover provides a second confirmation of bearish scenario could continue during the upcoming week.
Immediate support for Nifty 50 could be at 19190 seems to be a weak support level, and only a sustainable move above this could generate some reversal.
In a weekly chart, the Nifty 50 index, currently showing a thick presence of bears since mid-July, 2023 likely to escalate bearish momentum during the upcoming week as the Nifty Futures are currently trading below the index.
In a monthly chart, the formation of a black shadow confirms the continuation of a bearish trend during the rest of August 2023 as the Nifty 50 Index is near completion of a big red candle that could push the Nifty up to 18612 during the year 2023 if economic equations don’t get political support as everyone is worried about the upcoming election results.
Finally, I conclude that Indian indices could see a 76º fall shortly that may continue till the upcoming election results.
Disclaimer: The author of this analysis does not have any position in Indian stock markets. All the readers should take any trading position at their own risk as the stock trading may generate sudden moves till the next general elections.
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