As April 2 unfolds, all eyes are fixed on U.S. President Donald Trump and his anticipated announcement regarding new reciprocal tariffs. Market participants are on edge, creating a palpable sense of anxiety as they await the details. Following a disappointing close below 23,500 for the Nifty index, traders are closely monitoring critical support levels that could influence market trends.
Understanding Market Support Levels
Market analysts emphasize that the key support level to watch is positioned at 23,000. If the index manages to hold above 23,100, recovery hopes may rise, potentially leading to a rally towards the 23,300-23,350 range, according to Shrikant Chouhan, Head of Equity Research at Kotak Securities.
- Immediate support: 23,100
- Critical support: 23,000
- Potential rally: 23,300-23,350
Potential for Continued Market Corrections
Ajit Mishra, Senior Vice President of Research at Religare Broking, points out that a breakdown beneath 23,100 could further shake investor confidence. Conversely, maintaining this level might set the stage for a market rebound. Om Mehra, a Technical Analyst at SAMCO Securities, also notes that significant support is found at 22,850, with resistance looming around 23,450.
On Tuesday, the Nifty index fell below its expected range, breaching the moving average ribbon support at 23,400. This movement, coupled with a long bearish candle on daily charts, suggests that the market may continue its downward trend, as highlighted by Mishra.
Market Reaction to Tariff Announcements
On Wednesday, domestic equity markets faced a significant downturn amid the uncertainty surrounding Trump’s tariff plans. The Nifty 50 index dropped by 1.5%, closing at 23,165.70, while the Sensex plummeted by 1,390 points, or 1.80%, finishing at 76,024.51.
Anticipation of "Liberation Day"
April 2 has been dubbed ‘Liberation Day’ by Trump, a day when he is set to unveil the new tariff measures. As the announcement looms, market volatility has intensified, prompting a sell-off ahead of the event.
Siddhartha Khemka, Head of Research and Wealth Management at Motilal Oswal Financial Services, anticipates that market fluctuations will persist as global trade policies take center stage in the coming days. Traders should brace for increased volatility as they navigate through this critical period.
In summary, as investors keep a close watch on Trump’s tariff decisions, the market’s trajectory hangs in the balance, with key support levels guiding potential movements.
