According to Dharmesh Shah of ICICI Securities, the ongoing breather would make the market healthy which will eventually help the index to cross the resistance mark of 24,500 and lead further towards 25,000 mark.
This is resulting in the potential golden crossover in current month (May) and is indicating potential shift in market sentiment from bearish to bullish, he believes.
The Technical Head at ICICI Securities also believes continuation of the structural strength in Bank Nifty. "The robust price structure makes us believe the recent consolidation will cool off the overbought conditions, post which the index will challenge its all-time high of 56,100 and eventually head higher towards uncharted territory in May," he explained.
Nifty attempted to surpass the 61.8% Fibonacci retracement level but failed and closed flat on Friday. What does the current consolidation indicate? Could this lead to a significant breakout, especially with a potential golden crossover next week?
Equity benchmark witnessed buying demand from the psychological mark of 24,000, amid cool off related to tariff related developments and settled the lacklustre week with marginal gains. However, the index relatively outperformed the broader market as it gained 1.28 percent for the week. Consequently, the ratio chart of Nifty/Nifty Midcap witnessed a falling trendline breakout suggesting the benchmark to continue its outperformance.
Additionally, the current up-move is backed by the following key monitorable which would further act as tailwind:
a) Bilateral Trade Agreement between India and US
b) Continuation of FII's inflow
c) Further strengthening of Rupee post 1.5 percent of gains last week augurs well for equity market.
d) Decline in Brent crude oil prices
e) Record high GST collection, indicating strong domestic consumption demand.
The ongoing breather would make market healthy, which will eventually help the index to cross the resistance mark of 24,500 and lead further towards 25,000 mark, resulting in the potential golden crossover in May, indicating potential shift in market sentiment from bearish to bullish.
Based on the price action over the past week, do you expect Bank Nifty to decisively reclaim the record high of 56,100 next week?
The Bank Nifty is witnessing elongation of rallies as the recent up-move is larger (14 percent) as compared to that observed in the previous month (9 percent). Additionally, the declines are getting shallower as the recent decline is of 3.4 percent as compared to 5.6 percent observed in March 2025, indicating robust price structure. Going ahead, this robust price structure makes us believe the recent consolidation will cool off the overbought conditions, post which the index will challenge its all-time high of 56,100 and eventually head higher towards uncharted territory in May, continuing the structural strength.
What is your trading strategy for Nifty and Bank Nifty for the upcoming week?
We expect the market to consolidate in broader range of 24,500-23,500 trade with a positive bias amid ongoing volatility where the current breather would help index to form a higher base and close above 24,500 which will further fuel the rally towards the psychological mark of 25,000. For the coming week, strong support is placed at 23,800-23,500 zone. Meanwhile, on the upside, 24,500 would continue to act as immediate resistance.
What is your take on the Nifty Midcap 100 and Nifty Smallcap 100 indices?
Mirroring the benchmark index, the Nifty Midcap 100 and Nifty Smallcap 100 indices are witnessing breather post strong pullback of 18 percent and 21 percent, indicating extended breather. Notably, the MidCap index has retested its 200-day EMA, signaling inherent strength. Going ahead, we expect the indices to consolidate, amid volatility where stock specific action is likely to continue due to earnings season.
Do you anticipate a strong upward move in the Nifty FMCG and Nifty Auto indices?
The Nifty FMCG index is witnessing breather following the sharp up-move of 13 percent, where we expect the index to consolidate amid stock specific action. Meanwhile, the Nifty Auto index is witnessing higher base formation post 7 months falling trendline breakout, indicating end of corrective phase. Additionally, the recent softer tariff stance by US on imports of Auto and Auto components further augurs well for the index. Going ahead, we remain positive on passenger vehicle segment and auto ancillary tyre stocks.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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