Can Nifty breach 25,200 in today's session? Key levels to track on May 16

FIIs turning net buyers is a massive positive for the markets. To be sure, foreign investors purchased over Rs 5,000 crore yesterday, their biggest buying in three weeks.

Benchmark indices are poised for a strong start on May 16, with GIFT Nifty signalling a gap-up open. The Nifty 50 looks set to break past the 25,100 mark and make a dash for 25,200 in today's session.

In the previous session, bulls made a powerful comeback on Dalal Street, propelling the Nifty past the 25,000 mark for the first time since October 2024, ending a 141-session wait. The sharp surge was driven by strong gains in auto, IT, and metal stocks, adding a massive Rs 4.72 lakh crore to investors’ wealth on May 15 alone. Furthermore, in Doha, US President Donald Trump said India had offered a zero-tariff trade deal to the United States, boosting the sentiment further.

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With results mostly behind us, the element of uncertainty has reduced. A normal-to-above-normal monsoon forecast is a big positive for consumption-led sectors. Inflation is under control, and global tariff tensions—particularly those linked to Trump—have eased, creating a calm environment for investors. Furthermore, FIIs turning net buyers is a massive positive for the markets. To be sure, foreign investors purchased over Rs 5,000 crore yesterday, their biggest buying in three weeks.

Here are the key levels to watch out for in today's trade. 

According to a technical note from Prabhudas Lilladher, the Nifty has near-term support around the 24,450–24,500 band. "A decisive move above 24,800 could set the stage for targets of 25,200 and 25,400 in the coming days," the brokerage said.

The Sensex, which experienced a volatile session, retested the previous day’s low near the crucial 81,000 support zone before staging a strong recovery to trade at 81,330. “The index will need to breach 82,500 to improve the overall bias,” Prabhudas Lilladher added.

Technically, things are turning in favour of buyers, with Nifty Bank comfortably perched above all its important moving averages. The structure now looks robust, reflecting that the bulls have pretty much snatched the momentum away from the bears. With earlier resistance bands now being taken out, the directional trend is clearly pushing upward. The Nifty Bank index has now closed well above the psychological 55,000 mark, which adds more confidence for continuation. A pop above in today's session may add further fuel to the rally.

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The Nifty Put-Call ratio (PCR), which indicates the mood of the market, jumped to 1.19 on May 15, from 0.89 in the previous session. The increasing PCR, or being higher than 0.7 or surpassing 1, means traders are selling more Put options than Call options, which generally indicates the firming up of a bullish sentiment in the market.

The India VIX, the volatility index often referred to as the market's "fear gauge," fell for the fourth consecutive session, closing 1.93 percent lower at 16.89 levels. A further decline in volatility may provide comfort to the bulls and support the ongoing rally.