On Tuesday, June 4, Indian markets had their worst day in more than four years. This was a sharp reversal from Monday's gains, as polling patterns suggested that the current Narendra Modi-led NDA government would face a more challenging election than expected.
S&P BSE Sensex finished at 72,079, down 4,389.7 points or 5.74 percent, while NSE Nifty 50 closed at 21,884.5, down 1,379.4 points or 5.93 percent. In the meanwhile, intraday trading saw the worst intraday decline in the previous four years since March 23, 2020 as the Sensex plummeted 6,234.35 points, or 8.15 percent, to 70,234.4, while the Nifty fell 1.982.45 points, or 8.52 percent, to 21,281.4.
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Indian benchmark indexes saw substantial losses on June 4, the day of the vote counting. The Sensex fell 4,389.73 points, or 5.74%, to 72,079.05, while the Nifty fell 1,379.40 points, or 5.93%, to 21,884.50. The fierce political rivalry was reflected in the market's strong reaction to the Lok Sabha election outcomes. The NDA, which presently possesses 295 seats, was expected to do well; the INDIA coalition has 229 seats, indicating that the election would be closely contested. This anticipation led to the initial market confidence.
After a steep decline of 1,200 points, the Nifty fluctuated between 21,200 and 23,200, with a notable spread of more than 2,000 points. The index displayed a significant bearish candle, with 21,400 and 21,200 serving as important support levels.
The following levels of support are at 20,800 and 20,300 if these levels go through. To recoup and maybe hit fresh all-time highs of 23,500 and 23,700, the Nifty must rise above 22,800 and 23,000 on the upswing.
Religare Broking's SVP of Research, Ajit Mishra, stated that today's market drop erased the previous four months' gains. In terms of the index, Nifty has recovered somewhat after retesting its primary support zone around the 200 DEMA, the long-term moving average, after eight months, at roughly 21,280. Participants should minimize their transactions and bide their time until there is greater stability, as we anticipate further high volatility in the near future. Nonetheless, investors should use this chance to amass premium equities at competitive pricing. Important benchmarks to keep an eye on for Nifty's closing basis tomorrow are:
Nifty: Resistance is around 22,400–22,600 and Support is at 21,200–21,400.
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The Nifty 50's support levels are currently around 21,700 and 21,100. The Nifty 50 is now trading close to 22,000, and a closing over 21,700 would be an excellent time to think about going long.
On the upside, 22,800 serves as the first resistance level where profit-booking may start to occur. A break of the all-time high of 23,338 will be necessary to enable more gains.
Hrishikesh Yedve, Senior Technical Research Analyst at said that Nifty will encounter short-term resistance at 23,340 levels and support near 21,250, the location of the 200-DEMA.
In conclusion, there has been a great deal of volatility in the market as a result of the election results, and many experts have identified important support and resistance levels to keep an eye on. During this uncertain time, investors are recommended to approach cautiously and take advantage of opportunities to purchase high-quality equities.
