Expiry Day Volatility Seen as Nifty Remains Rangebound: Analysts
The Indian stock market has been experiencing a volatile ride lately, with the Nifty 50 index struggling to find direction. On Wednesday, the market managed to snap a three-day losing streak, ending marginally higher. However, the rebound did little to alter the broader technical picture, as the index remains stuck within a tight 24,500 to 25,200 range.
Analysts are now expecting increased volatility on the expiry day, and are advising investors to keep a close eye on the market’s movement. “The Nifty is likely to remain rangebound in the near term, with expiry day volatility likely to play out,” said a senior analyst at SEBI.
The Nifty 50 index has been oscillating within a narrow range of 24,500 to 25,200 over the past few trading sessions, with no clear direction in sight. This lack of direction has led to a high level of uncertainty among investors, who are waiting for a clear breakout to make any significant moves.
One of the key reasons for the rangebound market is the lack of clear cues from the global market. Global markets have been experiencing a mixed trend, with some indices rising and others falling. This lack of direction has led to a high level of uncertainty among investors, who are waiting for a clear trend to emerge before making any significant moves.
Another reason for the rangebound market is the lack of significant news flow. There have been no major economic indicators or corporate earnings announcements that have been able to move the market significantly. This lack of news flow has led to a high level of complacency among investors, who are waiting for something significant to happen before making any moves.
Analysts are now expecting increased volatility on the expiry day, which is likely to be driven by a combination of factors. One of the key factors is the high level of open interest in the market, which is likely to lead to increased volatility as investors try to square their positions before the expiry day.
Another factor contributing to the increased volatility is the high level of short covering that is expected in the market. Many analysts believe that the high level of short covering will be a key driver of the market’s movement on the expiry day, and are advising investors to be cautious.
Despite the expected volatility, analysts are advising investors to keep a close eye on the market’s movement. “It’s essential to watch for a breakout in the Nifty, which could lead to a significant move in the market,” said a senior analyst at SEBI. “However, until then, investors should be cautious and avoid making any significant moves.”
In terms of technical analysis, the Nifty 50 index is currently trading within a tight range of 24,500 to 25,200. The index has been oscillating within this range over the past few trading sessions, with no clear direction in sight.
The Relative Strength Index (RSI) is currently trading at 55, which is in the neutral zone. This suggests that the market is neither overbought nor oversold, and is likely to remain rangebound until a clear breakout occurs.
The Moving Average Convergence Divergence (MACD) is also trading in a neutral zone, with the MACD line above the signal line. This suggests that the market is likely to remain rangebound until a clear breakout occurs.
In conclusion, the Nifty 50 index is likely to remain rangebound in the near term, with expiry day volatility likely to play out. Analysts are advising investors to keep a close eye on the market’s movement, and are warning of increased volatility on the expiry day. It’s essential to watch for a breakout in the Nifty, which could lead to a significant move in the market.
