The Indian fairness benchmarks paused their current rally final week, with the Nifty ending simply above the psychological 25,000 mark. Nonetheless, the momentum indicators favour the bullish setup subsequent week, in keeping with analysts.
Whereas the headline indices confirmed indicators of gentle strain, the broader markets outperformed considerably. The BSE Midcap index gained 0.8 per cent, and the Smallcap index added 1 per cent, indicating continued shopping for curiosity past the large-cap house.
“This implies that traders have gotten extra assured out there’s breadth, typically a bullish signal for the general pattern,” in keeping with Kailash Rajwadkar of Selection Broking.
From a technical standpoint, the Nifty has just lately damaged out of a Rounding Backside sample on the weekly chart, supported by robust volumes—a bullish sign.
“The sample initiatives an upside potential towards 28,000 within the brief time period. Instant resistance is seen at 26,000–27,000 ranges, the place partial revenue reserving could also be thought-about. On the draw back, 24,300 and 24,000 are robust help zones; any correction towards these ranges ought to be seen as a shopping for alternative, holding the broader pattern intact,” Rajwadkar talked about in a notice.
Momentum indicators additionally help the bullish setup. The Relative Power Index (RSI) stands at 61.9 and is trending upwards, indicating rising power. Moreover, the Nifty is buying and selling nicely above its key exponential shifting averages — 20, 50, 100, and 200 — highlighting sustained constructive momentum. This technical alignment continues to favour a buy-on-dips technique.
Within the derivatives house, market volatility cooled off barely, with India VIX dropping 23.49 per cent to 16.55, reflecting a decline in worry and a extra secure buying and selling atmosphere.
“Nonetheless, heavy name writing at 25,500 and 26,000 ranges indicators resistance at increased zones, whereas robust put writing at 25,000 confirms it as a vital help. Merchants ought to maintain an in depth eye on the 25,000 stage—a sustained maintain above it could set off recent shopping for curiosity, although a risk-managed method is beneficial within the close to time period,” stated Rajwadkar.
Financial institution Nifty closed the week on a gentle notice, consolidating just under the important thing 56,000 mark. Regardless of restricted motion in Friday’s session, the index held agency above earlier breakout ranges, reflecting underlying power within the banking house.
The weekly chart reveals a breakout from a current consolidation vary, and the worth motion continues to carry above that breakout zone, signalling potential for additional upside.
In accordance with Nandish Shah, Senior Spinoff and Technical Analysis Analyst, HDFC Securities, the Indian Rupee appreciated marginally by 5 paise towards the US greenback, closing at 85.50 on Friday. This acquire was supported by a weakening greenback index and easing crude oil costs.
Among the many sector, Nifty Realty, Media and FMCG have been high gainers whereas Nifty IT, Healthcare and Steel sector ended within the purple.
“The short-term technical outlook for the Nifty stays bullish, because it continues to commerce above its key short-term shifting averages. The subsequent resistance stage for the Nifty is seen at 25,207, derived from the 76.4 per cent Fibonacci retracement of the earlier main decline. On the draw back, the 24,800 stage might supply rapid help,” Shah famous.
