Expiry Day Volatility Seen as Nifty Remains Rangebound: Analysts
The Nifty 50 index managed to snap a three-day losing streak on Wednesday, ending marginally higher. While the rebound brought some relief to investors, it did little to alter the broader technical picture. The index remains stuck in a tight range of 24,500 to 25,200, leaving traders and analysts alike waiting for a breakout.
According to experts, the Nifty’s rangebound movement is likely to continue in the near term, with expiry day volatility expected to play a significant role. As the market approaches the October futures expiry, analysts are advising investors to be cautious and watch for any significant moves.
“We expect volatility on expiry day as the market adjusts to the new positions and hedging requirements,” said a senior analyst at a leading brokerage firm. “The Nifty is likely to remain rangebound until there is a clear breakout or breakdown, which could occur on expiry day.”
The Nifty’s recent movement has been characterized by a lack of direction, with the index struggling to make meaningful gains or losses. This indecision has led to a tightening of the trading range, with the index oscillating between 24,500 and 25,200.
Analysts point to several factors contributing to the Nifty’s rangebound movement, including the ongoing impact of the global economic slowdown and the uncertainty surrounding the upcoming elections in India. Additionally, the recent rise in crude oil prices has also been a concern for investors, as higher energy costs could put pressure on the Indian economy.
Despite the challenges, analysts remain optimistic about the long-term prospects of the Indian market. They believe that the country’s strong economic fundamentals, including a robust banking system and a thriving startup ecosystem, will ultimately drive growth.
“The Indian market has historically been resilient in the face of global challenges, and we expect this trend to continue,” said a fund manager at a leading asset management firm. “While short-term volatility is inevitable, we remain bullish on the long-term potential of the Indian market.”
In terms of specific stocks, analysts are advising investors to focus on quality companies with strong fundamentals. They believe that these companies will be less affected by short-term market volatility and will continue to deliver long-term growth.
“We are advising investors to focus on quality companies with strong balance sheets and cash flows,” said a senior analyst at a leading research firm. “These companies will be less affected by short-term market volatility and will continue to deliver long-term growth.”
In conclusion, the Nifty’s rangebound movement is likely to continue in the near term, with expiry day volatility expected to play a significant role. Analysts are advising investors to be cautious and watch for any significant moves, while also focusing on quality companies with strong fundamentals.
