US Elections 2020: What's in store for Sensex, Nifty and other key indices

With a strong rebound from 50-DMA, both Sensex and Nifty have built a strong base that can see higher upside

The domestic equity market was trading over a per cent higher in the morning deals on Tuesday, ahead of the much-anticipated US presidential election due later in the day. The benchmark S&P BSE Sensex reclaimed the crucial 40,000 level to trade at 40,261 points while the NSE's Nifty was hovering around 11,400 levels.

As per reports, Democratic rival Joe Biden is ahead in national opinion polls, but races are tight in battleground states that could tip the election to Donald Trump. 

A Democratic sweep is seen as the surest path to the massive stimulus to help revive an economy decimated by the pandemic that has killed nearly 230,000 Americans. A stimulus deal could lift shares, fuel a long-awaited rotation to economically sensitive value stocks and accentuate trends of a weaker dollar and steeper yield curve. READ MORE

That said, here's a look at how key Indian indices look on charts and what should be your trading strategy.

S&P BSE SENSEX:  As the index holds the support of 50-day moving average (DMA), the trading around 39,180 levels with a strong rebound clearly indicates firm underneath strength which is gradually aiming at a higher level of 41,200. Going forward, till the index trades above 39,400 mark, the corrective moves and market sentiment are likely to see an elevated buying trend. The overall trend is optimistic with participants more proactive in the long-term outlook, instead of shorting the stocks, as per the daily chart. CLICK HERE FOR THE CHART

NIFTY50: In the last three sessions, the index traded near 50-DMA around 11,550 levels and every dip witnessed a buying reversal. The index could not breach the support firmly. And a gap-up session today further affirms the positive sentiment. This move may trigger a rally towards 11,200 mark with the support on the closing basis coming in at 11,600 levels.  Every move above 11,700 may see elevated upmove with aggressive volumes. CLICK HERE FOR THE CHART

NIFTYBANK:  This index has conquered the resistance of 25,230 which was near the 200-DMA earlier. This resistance resulted in a correction of over 15 per cent with a low of 20,400. Now, as the index climbs above 25,230 decisively, the rally is about to enter the uncharted territory of 27,000 levels. With this upmove, the support now stands at 24,700 levels with the Relative Strength Index (RSI) holding strong over 50 value. CLICK HERE FOR THE CHART

NIFTY IT: This index has more than doubled in the last seven months. Hence, it may take a pause before taking the next big leap, as per the “Higher High, Higher Low” formation on the weekly chart. The support comes in at 20,000 mark and till this is defended persistently, the downside bias is securely capped. CLICK HERE FOR THE CHART

NIFTY AUTO: The index is trading in the tight range of 7,650 to 8,300 levels. On the downside, the 100-weekly moving average (WMA) is holding the support, whereas the upside bias is capped around the resistance of 8,250 to 8,300 levels, as per the weekly chart. The volumes have remained subdued; however, the RSI and Moving Average Convergence Divergence (MACD) are gradually losing the upside steam. The breakout above this range will determine the next course of action. CLICK HERE FOR THE CHART

NIFTY FMCG:  This index is making efforts to hold the support of 200-DMA around 29,550 levels. However, the price is losing strength with RSI failing to build a positive crossover. Above all, the MACD is trading below the zero line with a negative crossover, signalling a downturn sentiment.  Now 100-DMA has made a negative crossover with 50-DMA, this implies every upside is going to face tough challenges. The immediate resistance comes in at 28,900 levels. CLICK HERE FOR THE CHART