There is pressure on the market due to heavy selling in IT stocks. Nifty is trading around 25,850, down about 100 points. There is pressure on Infosys, TCS, HCL Tech and Tech Mahindra. Bank Nifty is performing better today with flat trading. A decline is also being seen in midcap and smallcap stocks.

Along with IT, there is pressure on realty, chemical and capital market stocks too. All three sector indices have slipped by about one percent. Light buying is being seen in metals, auto and some selected NBFCs.

At around 10 am, the Sensex was down 319.53 points or 0.38 per cent at 83,914.11, and the Nifty was down 92.95 points or 0.36 per cent at 25,860.90. About 1,397 stocks are trading with gains. 1,923 stocks are trading down, while 162 are trading unchanged.

nifty strategy

Talking on market strategy, Virendra Kumar of CNBC-Awaaz said that initial resistance for Nifty is at 25,983-26,031, and major resistance is at 26,071-26,109/26,141. The initial base for Nifty is at 25,789-25,859, and the larger base is at 25,693/25,717-25,741. Keeping IT in mind, yesterday I had said that crossing 26,000 seems difficult. But as long as Base 1 holds, buy dips towards 25,900/867.

FIIs have again bought in cash. He has also made some purchases in the index. Net shorts have decreased slightly, but there is no significant change. Right now, they are at 1.32 lakh. 26000/25900 put is the most popular. If 25900 is crossed, then 25859-789 will also be seen. There are also heavy shorts with 26000/26100/26200 calls. Infosys and Wipro ADRs have slipped. This means that opening weakness and going below 200WEMA is possible.

Consider buying on controlled dips, which will be just above Base-1 (25858/789). There will be a buying zone in Base-1 downtrend. If it breaks, Base-2 will be tested below, so trade accordingly. As long as Base-1 holds, it is advisable to buy on downtrend for the target of 25983/26031.

Virendra Kumar said that the first resistance for Bank Nifty is at 60838-61010, and the major resistance is at 61195-61349. Its primary base is at 60145-60353, and its larger base is at 59849-60021. Yesterday, a strong buying trade was seen during a slight dip on Base-1, which closed at the day’s high. PSU banks again provided support. However, support is still not available from private banks.

60000 still has the highest OI for calls and puts, but there is very little action on the upside puts. However, it is true that it will be difficult to cross 61000, because private banks are not providing support. For now, focus on the current trade and check the trade at Resistance-1. There may be a rally above 61010. It would be better to move downwards near Base-1/60500.