Sensex Eyes 80,000 Post-Exit Poll Results: Key Levels and Market Insights

The exit polls for the recently concluded Lok Sabha 2024 elections are poised to significantly impact the Indian stock market sentiment on Monday, June 3. As the Narendra Modi-led National Democratic Alliance (NDA) aimed for over 400 seats at the campaign’s outset, the market is closely monitoring these results. A favorable outcome for the incumbent government could pave the way for policy continuity, a robust budget, and positive cues from global and domestic markets, potentially sparking a fresh bull run in the Indian stock markets in the coming months.

Recent Market Performance

Last week saw the equity benchmark indices retreat slightly after reaching record highs. On Monday, May 27, 2024, the S&P BSE Sensex hit a high of 76,010 but ended the week 2.5% lower at 73,961. Similarly, the NSE Nifty 50 index peaked at 23,111 before closing the week with a 2.7% loss at 22,531. In comparison, the NSE Nifty MidCap 150 and the Nifty SmallCap 250 indices corrected by 3% and 2.3%, respectively, from their record highs. Despite not reaching a new peak, the Bank Nifty outperformed the overall market, ending the week flat.

Technical Analysis: Key Indices

Sensex

• Last Close: 73,961

• Bull Case Scenario: 8.1% upside

• Bear Case Scenario: 6.9% downside

• Key Support: 72,240

• Key Resistance: 76,275

The S&P BSE Sensex could rally to 78,100-80,000 levels, indicating an upside potential of over 8% if a runaway rally occurs. However, a key hurdle exists at 76,275 levels, and the index must break and trade consistently above this level for a bullish scenario. Failing to do so may lead to consolidation, with 72,240 acting as a crucial support. A sustained trade below this level could see the index testing 71,000 or sliding further to 68,850.

Nifty

• Last Close: 22,531

• Bull Case Scenario: 7.1% upside

• Bear Case Scenario: 6.6% downside

• Key Support: 22,150

• Key Resistance: 22,800; 23,050

The NSE Nifty 50 is testing support around its 20-DMA at 22,480 and 22,380. Below this, major support stands at 22,150 (100-DMA), a level not violated since mid-November 2023. A break below 22,150 could lead to a sharp fall to the 200-DMA at 21,050, indicating a 6.6% downside risk. Interim support is seen around 21,900 levels. On the upside, clearing the hurdles at 22,800 and 23,050 could lead to a rally to 23,585, possibly extending to 24,125.

Nifty MidCap 150

• Last Close: 19,309

• Bull Case Scenario: 8% upside

• Bear Case Scenario: 13.2% downside

• Key Support: 18,150; 18,530; 19,050

• Key Resistance: 19,500; 20,100

Post its 100-DMA breakout in April 2023, the Nifty MidCap 150 has surged 68% in 13 months. It is now testing support around its 20-DMA at 19,050, with significant support at 18,530 (50-DMA). The 100-DMA at 18,150 remains crucial. A break below this could trigger a slide to the 200-DMA at 16,770. On the upside, breaking above 19,500 could lead to targets of 20,100 and 20,840.

Nifty SmallCap 250

• Last Close: 15,627

• Bull Case Scenario: 11.8% upside

• Bear Case Scenario: 11.9% downside

• Key Support: 15,000

• Key Resistance: 16,160

The Nifty SmallCap 250 faces resistance around 16,000. Breaking above 16,160 could lead to rallies to 16,815 and 17,470. Failure to break this resistance could weaken the index, making the 100-DMA at 15,000 crucial. Sustained trade below this could test the 200-DMA at 13,775.

Bank Nifty

• Last Close: 48,984

• Bull Case Scenario: 8.3% upside

• Bear Case Scenario: 8.8% downside

• Key Support: 48,300

• Key Resistance: 50,380

The Bank Nifty is crucial for market direction, facing resistance at 50,380. Breaking this could lead to rallies to 51,900 and 53,050, an 8.3% upside. Conversely, falling below 48,300 could trigger a decline to 46,200 and 44,660.

In conclusion, As markets reopen post-exit polls, traders and investors will closely watch these key levels. A favorable election outcome for the NDA could catalyze a bullish trend, driving indices higher. However, technical hurdles and support levels will play a critical role in determining the market’s direction. Investors should stay vigilant and prepared for both upside potential and downside risks as the political landscape unfolds.