Trade Setup For Feb. 3: Nifty Eyes 23,670 Resistance On The Upside

The NSE Nifty 50 immediate support levels are positioned at 23,400–23,350, with the key downside zones at 23,100–22,800 if the selling pressure intensifies. Analysts highlight that the index movement in the coming sessions will depend on how it reacts to these crucial levels.

Technically, the 20 DEMA levels of 23,400–23,350 is to be seen as immediate support and in case of any aberration, 23,100–22,800 are to be treated as key support zones in the coming week, according to Osho Krishnan, senior analyst of technical and derivatives at Angel One. "On the upside, the 50 DEMA around 23,670–23,700 and the upper band of the 'falling wedge' near 23,800–24,000 are likely to serve as key resistance levels to watch in the upcoming period," he said.

As the major Union Budget is over, the actual reaction is likely to be witnessed on Monday and hence, "we need to wait for a day or two to understand whether the market has really discounted the budget factor or not", he said. "Additionally, the risk with respect to Donald Trump imposing various tariffs is still looming over," he said.

The Bank Nifty closed flat to negative at 49,507. "The index has formed a small red candle on the daily chart with long shadows on either side, indicating uncertainty," Hrishikesh Yedve, research analyst at Asit C Mehta Investment Interrmediates Ltd., said.

"On the upside, 50,010 will act as resistance, and a breakout above this level could extend the up move to 50,500. On the downside, today's low of 48,925 will act as key support," he said.

Foreign portfolio investors stayed net sellers of Indian equities for the 22nd straight session as they sold stocks worth Rs 1,327 crore, , according to provisional data from the National Stock Exchange. Domestic institutional investors were net buyers for the 33rd consecutive session as they mopped up equities worth Rs 824 crore.

The Nifty February futures were up 0.94% to 23,639, at a premium of 130.6 points, with the open interest up by 2.77%.

The open interest distribution for the Nifty 50 Feb. 6 expiry series indicated most activity at 21,200 call strikes, with the 21,200 put strikes having maximum open interest.

The NSE Nifty 50 and the BSE Sensex ended the Budget day on a muted note as traders assessed the impact of announcements made by Finance Minister Nirmala Sitharaman.

The NSE Nifty 50 ended 0.11% or 26.25 points down at 23,481.15, and the Sensex ended 0.01% or 5.39% higher at 77,505.96 on Saturday.

During Sitharaman's speech, the Indian benchmarks erased morning gains and fell to the day's low. The Nifty 50 declined 0.81% to 23,318.30, and the Sensex fell 0.64% to 77,006.47.

• Hero MotoCorp: January total two-wheeler sales rose 2.13% to 4.42 lakh units compared to 4.33 lakh units last year. Exports increased to 30,495 units versus 12,664 units.

• Lupin: Lupin announced closure of inspection by USFDA at its Somerset Facility with no observations.

• Coal India: Production in January fell 0.8% against the year ago figure at 77.8 million tonnes, while total sales went up 2.2% at 68.6 million tonnes.

• Eicher Motors: Total motorcycle sales up 20% in January at 91,132 units, against an estimate of 87,000 units, while international business sales grew 79% at 10,080 units against the year ago figure.

• MOIL: January Manganese ore production was at 1.6 lakh tonnes. Sales during the month went up 17% against the year ago figure at 1.57 lakh tonnes. The company revised price of different grades of Manganese Ore and other products between 3.5% and 8.2% for the month of February, effective Feb. 1.

Asian stocks plunged while dollar and crude oil prices rose as US President Donald Trump unleashed the global trade war with levies of 25% on Canada and Mexico and 10% on China.

Japan's Nikkei was down 903 points, or 2.28% at 38,681 while South Korea's Kospi tumbled 2.88%, or 70 points to 2,445 as of 6:26 a.m. Future contracts in China and US hinted at a negative start for the stocks.

Trump signed tariff orders on Saturday, although Canada and Mexico announced their plans for retaliatory tariffs against the US. China also vowed retaliatory measures.

Canada will place a 25% counter-tariff on $107 billion worth of US-made products, while Mexico will kick off a response plan that includes retaliatory tariffs against the levies. 

The Euro and Mexico's peso fell while the Canadian dollar plunged to its weakest since 2003. This comes as trades rushed to buy the dollar amid its gaining strength. The dollar index — which tracks the greenback's performance against a basket of 10 leading global currencies — was 1.22% up at 109.69.

Stocks on Wall Street gave up gains last Friday after the benchmark indices climbed nearly 1%. The S&P 500 and the tech-heavy Nasdaq Composite fell 0.50% and 0.28%, respectively. The Dow Jones Industrial Average slipped 0.75%.

China Caixin services PMI data on Wednesday, UK rate decision on Thursday and India rate decision on Friday will be the ket data points to watch out this week.

Crude oil prices rose in anticipation of esclating global trade tensions. The Brent crude was up 0.63% at $76.15 a barrel as of 6:45 a.m. IST, and the West Texas Intermediate was up 1.72% at $73.78.

The Indian rupee closed flat against the US dollar on Friday at 86.62. The domestic currency opened flat, starting at 86.63.

The currency market was shut on Saturday. It will likely react to the Union Budget 2025 on Monday.