Nifty Comeback on the Cards? 5 Clues to Watch Out For

When will Nifty Recover?

Nifty, the popular Indian stock market index, has been on a rollercoaster ride in recent months. Traders are curious to know when it will hit the lowest point and start going up again.

To understand Nifty's journey, let's look at five important clues:

• FII Short Positions: When Foreign Institutional Investors (FII) make negative bets against Nifty, it usually goes up the next month. In October 2023, FII short positions were at 89%, which suggests that Nifty could see a rebound in November.

• F&O Rollover Data: If many traders keep their negative bets from one month to the next, it could be bad news for Nifty. However, if fewer people do, it could be a good sign. We need to monitor F&O rollover data to get a better sense of the market mood.

• Technical Chart Analysis - RSI: Nifty's Relative Strength Index (RSI) is currently around 34.99, which suggests that it may be on the road to recovery. When RSI goes from being very low to a bit higher, it often means Nifty is getting stronger.

• Technical Chart Analysis - 200 DMA: Nifty's 200-day Moving Average (DMA) is currently at 18,612. If Nifty stays above this line, it is usually a good sign. Traders watch this level closely for support.

• India VIX (Volatility Index): India VIX, which shows how jumpy Nifty is, is currently around 10.9050 and going down. This could be a hint that Nifty might go up, as a high India VIX indicates a shaky Nifty.

Putting all these clues together, it seems like Nifty may have hit its lowest point and could be ready for a comeback. However, it is important to note that the stock market is unpredictable, and there is no guarantee that Nifty will bounce back in the near future.

Traders should carefully monitor all relevant factors and make informed investment decisions.

Read Complete blog about Nifty.