The NSE Nifty 50 Index finds key resistance at 25,800 levels after extending its rally to a second consecutive trading session on Monday, according to analyst Shrikant Chouhan, head of equity research, Kotak Securities.
"We believe that the 20-day simple moving average or 25,600 will act as an immediate reference point for day traders. As long as the market is trading above this level, the bullish momentum is likely to continue," Chouhan said.
The index formed a small bullish candle with shadows in either direction, signalling consolidation with positive bias for the second session in a row. The index in the process moved above its 20 and 50 days extended moving average, according to Bajaj Broking Research.
The Nifty is consolidating in the range of 25,400-25,900 in the last seven to eight sessions. Only a breakout or a breakdown below this range will signal next direction trend, according to Bajaj Broking Research. Volatility is likely to remain elevated amid uncertain global cues, the brokerage said.
A successful breakout of 25,800 could push the market up to 25,950–26,000, as per Chouhan. "On the flip side, below 25,600, sentiment could change. If the market falls below this level, it is likely to retest the levels of 25,500–25,450," the analyst stated.
Bank Nifty
The Bank Nifty Index finds support at 60,800–60,900 levels, according to Aakash Shah, technical research analyst at Choice Broking. "The index remains firmly above the psychological 61,000 mark, signalling underlying strength," Shah said.
"Technically, the 60,800–60,900 range now stands as a crucial near-term support and demand zone, reinforcing stability despite recent volatility and strengthening the short-term structure," he added.
Bank Nifty formed a high wave candle with small real body and shadows in either direction, signalling consolidation amid stock-specific action, according to Bajaj Broking Research.
"Bias remains positive and we believe dips should be used as buying opportunity, with short term support seen at 60,500-60,200 levels being the confluence of the 20 days extended-moving average and the key retracement of previous up move," the brokerage said.
Market Outlook
Indian equity benchmarks extended rally for the second consecutive trading session, led by the gains in HDFC Bank Ltd. and Reliance Industries Ltd. The BSE Sensex closed 0.6% or nearly 500 points higher at 83,294, while the NSE Nifty 50 rose 0.6% to end above 25,700. The broader markets represented by the NSE Nifty 500 Index rose 0.4% led by Blue Jet and Aegis Vopak's 9% rally.
Eleven out of 15 sectoral gauges compiled by the NSE ended higher, led by the NSE Nifty PSU Bank Index's 1.4% gains. On the flipside, the NSE Nifty IT Index was the top sectoral loser, down 1.5%. The market breadth, however, was tilted in favour of sellers. Nearly 2,400 stocks declined while 1,916 stocks advanced on the BSE.
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