The bearish pattern of lower tops and bottoms of the last month seems to have reversed, as Nifty closed above the recent lower top of 21st Jan at 23,426 levels. This is a bullish development and eventually, we could see the formation of bullish higher tops and bottoms. The underlying trend of Nifty remains strong. Having surpassed the hurdle of 23,500 levels, bulls could advance towards another resistance of 23,800 levels in a short period of time. Immediate support is at 23,400 levels, said Nagaraj Shetti.
In the open interest (OI) data, the highest OI on the call side was observed at 23,500 and 23,600 strike prices, while on the put side, the highest OI was at 23,500 strike price followed by 23,400.
What should traders do? Here’s what analysts said:
Hrishikesh Yedve, Asit C. Mehta Investment Interrmediates.From a technical perspective, Nifty crossed its short-term hurdle of 23,430 and formed a strong bullish candle on the daily chart, indicating strength. The index also sustained above its 21-day Simple Moving Average (21-DSMA) at 23,310, making it an immediate support level, while trendline resistance at 23,800 will act as a key hurdle. Traders are advised to adopt a buy-on-dips strategy.
Rupak De, LKP Securities
The Nifty has given a falling wedge breakout, indicating a short-term bullish reversal. The index has also moved above the 21-period EMA, reinforcing the positive momentum. Additionally, the current RSI reading supports a strong upward move in the market. However, much will depend on how market participants react during and after the budget. Support is placed at 23,300–23,200, while resistance is seen at 23,600 and 23,800.
Satish Chandra Aluri, Lemonn Markets Desk
Benchmark indices witnessed a pre-budget rally on Friday extending gains for the fourth consecutive day ahead of the budget session. Broader mid and small-cap indices also rallied outperforming the benchmarks. It’s a broad-based rally across the sectors on budget optimism evident in the last few sessions with Infra, and PSE stocks leading the rally. Positive earnings surprises from blue chips like Nestle, Tata Consumer and L&T also aided the sentiment. Economic survey, tabled today in Parliament, also contributed to positive sentiment as growth projections of 6.3%-6.8% for FY26 were in line with expectations while comments on the increasing pace in capex spending from the government improved the sentiment ahead of budget announcements. Technically, the Nifty 50 had a sharp rally towards the 23,500 level, eventually closing just above that. Expect a rise in volatility on budget announcements with resistance around 23,650 while on the downside, 23,200 can act as immediate support.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
