NIFTY Bank is a pivotal index for the near future.

To propel NIFTY towards 23,900, NIFTY Bank must provide substantial support. Private sector banks have exhibited resilience during recent market downturns. This stability is likely to persist as long as NIFTY Bank remains above 50,900. A breach of 50,900 could trigger a sharp decline, potentially targeting 49,600 and 48,500 in the coming days.

ICICI Bank’s upcoming results will be closely watched. The stock has met our selling criteria, so its performance will be a key indicator. While there are no immediate time cycle dates for the index, several private banks have significant cycle dates on October 30th, which could influence the overall market.

https://ganninsides.com/2024/10/18/nifty-breaks-support-bearish-trend-resumes/

“NIFTY successfully achieved its primary target of 24,350 today, as anticipated in my October 18th forecast. Consistent with our predictions, market volatility has intensified this week. Last Friday, I identified the 24,900-25,100 range as a strong resistance barrier. NIFTY’s attempt to breach this zone on Monday resulted in a sharp price reversal. “If the index remains below 24,800, it may continue to decline toward its next target of 23,900.”

NIFTY’s breach of the critical support levels at 24,750-24,660 has signaled a renewed downward trend. Despite this downturn occurring amidst an incomplete retracement, we can anticipate a somewhat bumpy road ahead. Therefore, I recommend selling on rallies towards the 24,900-25,100 resistance zone. Potential targets for this bearish move include 24,350 and 23,900 in the coming days. Additionally, we expect volatility to increase significantly starting next week.

NIFTY is still consolidating, and this consolidation has been happening with a positive bias. I expect NIFTY to continue this way for a few more days. If something goes wrong, it will likely be from the IT sector. Still holding 24,750 and 24,660 on spot. This pullback should continue towards 25,300-25,400 before turning lower. A turn is due in any case, but a turn after some more pullback would be more ideal.

As I predicted in my Sunday post, NIFTY is taking a temporary pause today, October 8th, a significant cycle date. If the market can hold today’s intraday low at the close, it could provide a brief respite from the severe sell-off that began on September 30th. From a technical standpoint, 24,660 serves as a critical support level. A breach below this mark, accompanied by a daily close below today’s low, would significantly diminish the prospects for a meaningful near-term pullback. However, if the market can sustain above 24,660, a decent pullback is likely to occur.

“There are three significant warning signs for Indian markets: 1 India’s market liquidation has begun. 2 Recent market declines have occurred despite lower volatility. 3 Global markets have not yet started their decline. I have adjusted my targets downward, and these changes have been communicated to subscribers.”

“Last Friday, we anticipated NIFTY to complete its current bullish structure by forming a higher high above 25,800 and a lower low below 25,377. This structure was activated on September 12th when NIFTY decisively broke through its critical resistance at 25,333. From that point, the market’s dynamics became increasingly intricate and intriguing. The rallies in U.S. indices on September 11th and Indian indices on September 12th shifted the short-term outlook for both markets to bullish. This typically suggests a timeframe of approximately 12 to 15 days. Consequently, we should be nearing the culmination of this short-term trend within the next 3 to 4 trading sessions. The market’s actions over the coming days will be pivotal for ensuring a harmonious alignment of price and time cycles.”

Technically, near-term support for NIFTY is currently at 25,700. This level of 25,700 was calculated by drawing a diagonal of a square constructed using the closing high of 25,940. If NIFTY drops below 25,700 on an end-of-day (EOD) basis, it could be dragged further lower towards its pattern completion point of 25,377. The major structural support would be at 25,250. A drop below that level might push NIFTY towards a retest of its September 9 low of 24,753. Therefore, 25,700 must break first, followed by the other mentioned supports.

Regarding time, September 26 is a key date, followed by October 1 and October 3. October 1 is particularly important because it is a price and time squaring date.

“S&P 500 Consolidates: Key Levels to Watch”

Lastly, let’s discuss the S&P 500, which has been consolidating since last Friday. As discussed earlier, there are no signs of weakness until it holds the September 19 low on a closing basis. Resistance on the upside is at 5,775. On the time front, September 26 is an important cycle date, followed by September 30 and October 1. Interestingly, the S&P 500 and Dow Jones Industrial Average are exhibiting a similar intermarket divergence with the Nasdaq, reminiscent of January 2022. If the Nasdaq fails to reach new highs, history might repeat itself.”

Markets are still digesting the FOMC policy. Actually, the overall positioning was for a 25 basis point cut, but since we got a 50 basis point cut, cross-asset equations needed rebalancing. This resulted in a significant up day in the U.S. markets. In the U.S., we were watching Thursday’s session closely because it was a key cycle date. Therefore, yesterday’s low on all U.S. indices would be a very important level for the next few days. A break of that low on a closing basis would drag indices towards their supports. For the S&P, those supports stand at 5610 and 5475 on the downside.

“Similarly, for NIFTY today, the intraday low is a key date. Regardless of its value, it will be crucial for the coming days. As we discussed earlier, the U.S. markets will likely turn first, and other markets, including Indian markets, will follow. Until then, there’s little to anticipate for Indian markets.”

“The positive aspect is that volatility has picked up on the price fluctuation front.
However, this is not reflected accurately in the VIX index.
We still need the VIX to rise in the future. As broader markets underperform and private banks outperform, we should see a higher VIX.”

For NIFTY  we need a higher high above 25800 and then a lower low below 25377 to complete current pattern additionally  on time front Every third day from today until October 15 will be a significant day for NIFTY. The importance of these dates will become apparent as we continue to monitor the market.”

“Tonight’s FOMC meeting could be a watershed moment for global markets. As we’ve been anticipating, the Fed’s decision could trigger a seismic shift in risk asset sentiment. Once this event is concluded, we might witness a dramatic market downturn, likely starting tomorrow or Friday. However, it’s important to note that this decline might not necessarily begin today.”

“U.S. markets are currently the most influential, as their performance often sets the tone for global markets, including India. If the U.S. markets experience a significant downturn, it could validate the sell signals that have been emerging from time cycle analysis since early September. To monitor this development, we’ll be focusing on U.S. markets starting tomorrow evening and Indian markets from Friday morning.”**

Following this event, we anticipate a surge in market volatility. India’s VIX is expected to spike to 16, while the CBOE VIX could reach 22. If these levels are breached, a market panic is imminent. For the Nifty, major support levels are at 25,000 and 24,750 on the spot. For the S&P 500, major support is at 5,475. Regardless of how distant these support levels may seem, once volatility increases, it could take only a day or two to break through them.