Stock Market Update: Market Faces Continued Correction, Trade Strategy for Monday, Nov 18
The market correction persisted during the week ending November 14, with the benchmark Nifty-50 Index and S&P BSE Sensex closing near their weekly lows at 23,532.70 and 77,580.30, respectively, reflecting a drop of nearly 2.5% from the previous week. The Bank Nifty saw a sharper decline of over 3%, while sectors such as Auto, Metals, and FMCG bore the brunt of the selling pressure. Although IT stocks were relatively stable, broader indices struggled, with mid- and small-caps falling by more than 4%.
Trade Setup for Monday:
Looking ahead, the Bank Nifty is expected to move lower towards the 49,700 level (200 DMA). On the upside, resistance lies between 50,560 and 50,700, forming a key hurdle for the short term, according to Jatin Gedia, Technical Research Analyst at Sharekhan.
Global Market Outlook & US Dollar Impact:
The global market outlook remained subdued, with Asian markets showing weakness and European and US indices also closing the week on a soft note.
Vinod Nair, Head of Research at Geojit Financial Services, pointed out that the domestic market is currently in a correction phase, impacted by weak Q2FY25 earnings and continued foreign fund outflows. He also noted that the recent spike in domestic CPI inflation to a 14-month high of 6.2%, a strong US dollar index, and rising US 10-year yields are contributing to short-term market volatility.
Market Sentiment:
The market texture is weak, yet oversold conditions are emerging. For positional traders, key support levels are the 200-day SMA (Simple Moving Average)—23,500 for the Nifty and 77,400 for the Sensex. Should the indices hold above these levels, there is potential for a short-term technical pullback, with targets of 23,800-24,000 for the Nifty and 78,500-79,000 for the Sensex, said Amol Athawale, VP of Technical Research at Kotak Securities.
This analysis provides a clear picture of current market conditions and actionable insights for the upcoming week.
