May Market Wrap: A Deep Dive into Nifty50’s Performance

Today, the Nifty 50 index opened at 18594.20, which was 39.65 points lower than its previous day’s closing of 18633.85. The market began correcting during the early morning trading session. Over the past two days, Nifty had been trading within a narrow range of approximately 80-90 points, with the range set between 18660 and 18580. However, today, in the first five-minute candle, Nifty broke this range with a significant red candle spanning around 68 points. 

During the afternoon trading session, Nifty made an attempt to recover from its day’s low, but the selling pressure from bears remained strong and still managed to recover only 50 points only. Ultimately, Nifty closed in red at 18534.40, down by 99.45 points or 0.53% compared to the previous day’s closing. Importantly, it filled the gap area between 18500 and 18580, which was created on May 29, 2023. 

At the start of May, Nifty began trading at 18124.80, which was a 59.8-point up from the previous month’s closing of 18065. On the last trading day of the month, Nifty closed at 18534.40, forming a significant monthly bullish candle on the charts. Throughout the month, Nifty delivered a return of 2.7% and is currently trading very close to its all-time high of 18887.60. Over the past three months, Nifty has provided an absolute return of 7.6%. Its 52-week high and low are 1887.60 and 15183.40. 

Turning attention to the other two indices, the Nifty Bank Index and the Nifty IT Index, both have yielded returns of 2.5% and 4.5%, respectively. Nifty IT displayed a recovery from its lows during May, while Nifty Bank achieved a new all-time high of 44498.60 on May 30, 2023. 

Top 10 High Weightage Stocks in Nifty50 Performance

Based on the provided data, it can be observed that high-weightage stocks have not performed well and managed to generate a return between 2% to 8% during this month, Both ITC Ltd and Axis Bank Ltd, delivered a return of 6% and 7.7%, respectively. On the other hand, L&T Ltd has experienced a negative return of 7.3%.

Top 5 Best Performers:

Top 5 Worst Performers:

On the daily timeframe, the Relative Strength Index (RSI) is currently at 64.99, while on the weekly and monthly timeframes, it stands at 61.80 and 63.11, respectively. Notably, the RSI remains above 60 on all major timeframes, which could be seen as a positive indication for the upcoming month. Additionally, Nifty50 is trading above key Moving Averages such as the 20-day, 50-day, 100-day, and 200-day averages on major timeframes.

From a technical perspective, Nifty 50 has strong support levels at 18450 and 18300, while it could encounter resistance around 18600 and 18800 before surpassing its all-time high. 

Looking at the current weekly expiry, which is set for June 1, the Call Open Interest is approximately 25.6 lakh, whereas the Put Open Interest stands at 21.45 lakh. Notably, there is significant open interest at the 18600 and 18700 Call strike prices, with 2.82 lakh and 2.67 lakh, respectively, and a considerable change in open interest of 1.38 lakhs at the 18600 level. On the Put side, there is substantial open interest at the 18500 and 18400 strike prices, with 2.25 lakh and 1.66 lakh, respectively, indicating these levels may act as immediate resistance and support for the upcoming expiry. The Put Call Ratio (PCR) for Nifty50 is currently 0.84, while the PCR for the June month expiry stands at 1.45, according to data from the National Stock Exchange. 

Given that the Nifty Bank recently broke its all-time high, there is significant potential for Nifty50 to achieve a new milestone by surpassing its own all-time high. Investors should closely monitor the movement of Nifty50 to take advantage of the potential upside in the market.