Strong technical recovery signals market reversal
The Nifty index demonstrated robust technical strength by maintaining levels above the budget day low of 24,571, marking the first clear reversal signal. Following a gap-up opening, the benchmark index came within striking distance of its all-time high, reaching 26,341 compared to the record of 26,373.
“Nifty has now reclaimed its level above 20, 50, 100, and 200 days EMA, which is a very good sign,” Rajani explained, highlighting the technical indicators supporting the bullish momentum.
Bank Nifty hits new all-time high
While Nifty approached its previous peak, Bank Nifty successfully registered a fresh all-time high during yesterday’s trading session, demonstrating strength in the financial sector.
Key support levels and trading strategy
Rajani identified critical support levels for investors looking to capitalize on market opportunities:
- Support band: 25,500 to 25,650
- Strategy: Buy on dips within this range
- Outlook: Fresh all-time high expected for Nifty
“Downside is limited. Dips should be bought into,” Rajani advised, emphasizing that largecap stocks and benchmark indices are positioned to perform well in the current market environment.
Top stock picks for traders
Jindal Steel & Power
- Buy level: ₹1,150
- Stop loss: ₹1,130
- Target: ₹1,180
- Rationale: Continued strength in base metal space with strong closing patterns
ABB India
- Buy level: ₹5,735
- Stop loss: ₹5,600
- Target: ₹5,925
- Rationale: Textbook trend reversal pattern on weekly and monthly charts, potential shift from underperformance to outperformance
Market outlook
The technical analyst emphasized that largecap stocks are expected to lead the market higher, with the broader market having undergone healthy corrections. Despite the gap-up opening presenting challenges for traders who missed the initial move, the overall trajectory remains positive.
The India-US trade deal, featuring an 18% tariff structure, has provided the catalyst for renewed investor confidence, though complete details of the agreement are still emerging.
Disclaimer: The views and investment recommendations expressed are those of the analyst and not necessarily those of HDFC Securities. Investors are advised to consult with certified financial advisors before making investment decisions.