Sensex Above 74,000, Nifty Past 23,300 May Strengthen Recovery: Analysts

(MENAFN- IANS) Mumbai, Sep 27 (IANS) Benchmark indices Sensex and Nifty recovered on Friday after a sharp sell-off in the previous session, but analysts said the market's near-term trend remains cautious, with the Sensex needing to sustain above 74,000 and the Nifty above 23,300 to strengthen the recovery momentum.

The 30-share Sensex rose 315.20 points, or 0.43 per cent, to close at 73,895.74. During the day, the index touched an intra-day high of 73,968.05 and a low of 73,477.77, witnessing a swing of nearly 490 points. The recovery came a day after the Sensex slipped to its lowest level in more than three months.

The broader Nifty also rebounded, gaining 77.40 points, or 0.34 per cent, to settle at 23,140.50. Despite Friday's gains, technical analysts said the market continues to exhibit a cautious undertone, with key resistance and support levels likely to determine the next directional move.

Market watchers said the Sensex continues to maintain a sideways-to-bearish outlook. According to experts, the 73,200-73,450 zone remains a crucial support area for the index.

“The Sensex continues to maintain a sideways-to-bearish outlook, with 73,200–73,450 acting as the crucial support zone. Sustained buying above 74,000 could strengthen the recovery and open the way towards 74,200–74,500, while a break below the support band may revive selling pressure," market watchers stated.

"For now, traders should monitor the 73,500–74,000 zone closely along with OI changes for confirmation of the next move,” analysts noted.

On the Nifty, experts said the index managed to recover modestly after Thursday's sharp fall but its short-term technical structure remains weak.

Technically, Nifty is witnessing a gradual deterioration in its weekly structure, with the recent breakdown below the 23,070 support zone weakening the near-term setup.

"On the upside, immediate resistance is placed at 23,400 and 23,600. A sustained move above this zone could provide some relief and help the index regain stability," market watchers stated.

"On the downside, support is seen at 23,000 and 22,800. A decisive breakdown below 22,800–23,000 could further weaken the structure and open room for additional downside," analysts added.

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