Hello reader, hope you’re doing well. Early Wednesday trades are witnessing a downward drift in markets, influenced by poor cues from the US overnight and a decline in other Asian indices. A sense of caution is expected to persist, leading to a prolonged period of profit-booking in the upcoming sessions, as investors remain attentive to the global sentiment. The primary driving force will be a speech by Fed Chair Jerome Powell on May 26, which is anticipated to have a significant impact. The only positive aspect is that foreign institutional investors (FIIs) continued to be net buyers even in yesterday’s bearish markets. From a technical standpoint, the Nifty index’s crucial support level is identified at 18181 points, and significant obstacles may arise at the 18473 level.
Important points to note:
- Nifty nearing the key support zone of 18200 levels.
- Banknifty has retested the previous breakout level of 43800.
- Adding a call spread on Nifty here would be a simple low risk trade – 18150 CE buy with 18300 CE sell, monthly expiry contracts to be taken here.
As always, risk management is key, and a proper system in place prevents one from losing out too much, in case of outlier events. Have a good trading day, and may the force be with you!
Disclaimer: this post is for educational purposes only, we are not SEBI registered analysts. Trades mentioned here are not trade recommendations. Equity Investments are subject to 100% market risk, please consult your financial advisor before investing.