RBI Cuts Repo Rate by 40 Basis Points – Nifty Analysis 22.5.2020

Nifty 5 Min Intraday Chart 22.5.2020
Nifty 5 Min Intraday Chart 22.5.2020

RBI announced repo & reverse repo rate cut by 40 bps each. RBI expects FY21 GDP growth to be in negative territory. RBI also announced an extension of moratorium by additional 3 months, till August-end. The Governor also announced other measures in his press conference

Open 9067 High 9149 Low 8968 Close 9039

Nifty opened with a gap down of 14 points at 9067 levels and touched a low of 9026 on the first 5 minute candle. Nifty rallied 83 points from opening levels to touch a day high level of 9149 at around 10 am.

The market seemed to be disappointed by the measures and commentary of RBI Governor as Nifty fell 180 points in just 30 minutes to touch a day low level of 8968 at around 10.40 pm.

Nifty took support at 8950 levels and regained 9000 levels. Nifty rallied 99 points from day low levels to touch a high of 9068 just before the closing bell.

Nifty closed the day at 9039 down 67 points or 0.74 percent.  

Nifty is quite volatile these days. Trading these kinds of volatile markets is difficult.Nobody knows when or at what level Nifty will bottom out. But as Nifty is not breaching the recent low levels of 7525 levels the level of 7500 can be treated as a temporary bottom.8800-9000 levels will act as a crucial support zone for the index whereas 9200-9300 will act as heavy resistance areas.A big bullish breakout will occur only above 9500 levels.

Market Breadth Nifty

Advances 24 Declines 26

The highest gainer among Nifty 50 index was Zee Entertainment up 7.11 percent and biggest loser was Axis Bank down 5.21 percent. 

FNO Data Analysis

Nifty April Futures are trading at a premium of 2 points.

For May 28 expiry

Highest open interest Call side is at 10000 ce around 30.5 lakh shares

Highest open interest Put side is at 9000 pe around 32.7 lakh shares

Huge amount of put writing at 8800 pe means 8800 will act as strong support level for Nifty

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