Data suggests that FIIs are cautiously optimistic on the market, with a focus on large-cap stability amidst market uncertainty, said Sudeep Shah of SBI Securities in an interview to Moneycontrol.
According to him, any sustainable move above the zone of 23,900-23,940 will lead to a sharp upside rally in the Nifty 50 upto the level of 24,200, followed by 24,500 in the short term.
For the next week, the Deputy Vice President and Head of Technical and Derivative Research at SBI Securities bets on Bajaj Finserv and Indian Bank. "Bajaj Finserv has given a stage-2 cup pattern breakout on a daily scale, which is accompanied by robust volume, while Indian Bank has given a 77-day consolidation breakout along with robust volume and currently, it is trading above its short and long-term moving averages," he reasoned.
Technically, how do you view this rally as the Nifty 50 has surpassed its previous swing high? Given the strong weekly close, do you think it will reclaim December 2024 swing high?
"The strongest rallies are born from the depths of doubt." This is what we have witnessed in the last couple of trading sessions. The benchmark index Nifty has staged a sharp rally from its recent low of 21,743.65, gaining over 2,100 points in just seven trading sessions — marking one of the fastest upswings in recent times. This remarkable rally has pushed the index above both its short and long-term moving averages. Notably, the 20-day and 50-day EMAs (Exponential Moving Average) have begun to curve upward, reinforcing the bullish momentum. Adding further strength, the daily RSI (Relative Strength Index) has surged past the 60 mark and continues to rise, indicating increased buying interest.
What makes this rebound even more remarkable is the context in which it has unfolded — a period clouded by uncertainty, driven by trade war tensions and looming recession fears. Yet, amid the noise and negativity, the market has managed to flip the script with a sharp turnaround. It’s a classic example of how markets often recover with force just when conviction is hardest to find.
The Banking and Financial Services sectors have been the primary drivers of this rally. The Nifty Financial Services index has clocked a fresh all-time high, while Bank Nifty is just a stone’s throw away from its record levels. Interestingly, the Nifty Midcap and Nifty Small Cap 100 indices have lagged behind in the last couple of sessions, highlighting that this rally has been primarily powered by large-cap names.
At present, the Nifty is hovering around a key resistance zone of its prior swing high’s. Any sustainable move above the zone of 23,900-23,940 will lead to a sharp upside rally in the index upto the level of 24,200, followed by 24,500 in the short term. However, on the downside, 23,600-23,550 is likely to provide the cushion in case of any immediate decline.
How are FIIs and proprietary traders positioning themselves after the recent shift in market sentiment?
Over the last three trading sessions, FIIs have turned net buyers in the cash segment, signaling a shift in sentiment. This coincides with visible accumulation in large-cap stocks, suggesting that FIIs are selectively adding quality names to their portfolios. Additionally, the sharp rise in the long-short ratio of index futures—from 21.59 to 29.52—indicates that FIIs are actively covering their short positions. Taken together, this suggests a cautiously optimistic stance from FIIs, with a focus on large-cap stability amidst market uncertainty.
Do you believe Bank Nifty will be a major driver and a supportive factor for the broader market going forward?
Absolutely. The banking index Bank Nifty has been clearly outperforming the broader market over the last few sessions. It’s just a stone’s throw away from its all-time high, while Nifty still trades more than 9% below its peak — a clear sign of sectoral strength.
What’s even more interesting is the ratio chart of Bank Nifty versus Nifty, which is now at an 81-week high, reinforcing the relative outperformance.
Technically, with the index hovering near all-time highs, all key moving averages and momentum indicators are aligned positively, indicating strong bullish momentum. We expect this northward journey to continue, with Bank Nifty likely heading toward the 55,000 mark in the near term. On the flip side, the 53,800–53,700 zone is expected to act as immediate support in case of any short-term dip. Hence, Bank Nifty is well-positioned to act as a major driver for the broader market in the sessions ahead.
Is this a good time to consider positions in ABB India, ICICI Bank, and Zomato?
ABB India and Zomato have recently broken out of consolidation zones, closing above both their short and long-term moving averages — a strong bullish signal. The daily RSI for both stocks also indicates rising momentum, further supporting the breakout.
ICICI Bank, on the other hand, continues to outperform the frontline indices and is currently trading at an all-time high. All key moving averages and momentum indicators are aligned in favour of the bulls, suggesting the uptrend is intact.
Given the strong chart structures and positive momentum, ABB India, ICICI Bank, and Zomato can be considered for short-term positions.
What are your top two stock picks for the upcoming week?
On Friday, the stock has given a stage-2 cup pattern breakout on a daily scale. This breakout is confirmed by robust volume. In addition, it has formed a sizeable bullish candle on a breakout day, which adds strength to the breakout. Currently, all the moving averages and momentum-based indicators suggest strong bullish momentum in the stock. Hence, we recommend accumulating the stock in the zone of Rs 2,040-2,020 level with a stop-loss of Rs 1,960. On the upside, it is likely to test the level of Rs 2,150 in the short term.
The stock has given a 77-day consolidation breakout along with robust volume. Currently, the stock is trading above its short and long-term moving averages. These averages are in rising trajectory. The daily RSI is in bullish territory, and it is in rising mode. Hence, we recommend accumulating the stock in the zone of Rs 576-571 level with a stop-loss of Rs 550. On the upside, it is likely to test the level of Rs 615 in the short term.
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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