Is there more steam left in Nifty after 800-point rally in 4 days? Market experts suggest resistance and support levels

Is there more steam left in Nifty after 800-point rally in 4 days? Experts suggest resistance and support levels

Benchmark indices Sensex and Nifty surged over 1 percent on March 20, thus extending  their gaining streak for the fourth consecutive session, supported by broad-based buying and positive global cues after the US Federal Reserve maintained its rate-cut projections for this year.

The rally was led by heavyweight stocks, including Reliance Industries and Bharti Airtel, while IT stocks also contributed to the uptrend.

Sensex jumped 899.01 points or 1.19 percent to close at 76,348.06, reclaiming the 76,000 level. It touched an intraday high of 76,456.25, gaining 1,007.2 points or 1.33 percent. Meanwhile, the NSE Nifty surged 283.05 points or 1.24 percent to settle at 23,190.65, crossing the crucial 23,000 mark.

Over the past four sessions, Nifty has gained nearly 4 percent, rising 793.45 points and has now closed above its 50-day exponential moving average (EMA) for the first time since February 5, 2025.

Is there more steam left in Nifty?

Ruchit Jain, VP and Head of Equity Technical Research at Motilal Oswal Financial Services, said the market had been under pressure since October 2024 due to a rising dollar index and persistent selling by foreign institutional investors (FIIs). However, the dollar index has cooled from 110 to around 103, and FIIs have covered some of their short positions in index futures.

"Their ‘Long-Short Ratio’ has improved from 15 percent to 27 percent as of Wednesday, leading to a market rebound. The broad-based nature of the rally indicates momentum could continue toward the 200-day EMA, which is positioned between 23,400 and 23,600. Any dips could see Nifty forming a higher bottom, making it a buy-on-dips market," Jain said.

Echoing a similar view, Rupak De, Senior Technical Analyst at LKP Securities, pointed out that Nifty has given a falling trendline breakout on the daily chart, signalling a bullish reversal.

"The index has held above the 21-day EMA for three straight sessions, reinforcing the short-term uptrend. Additionally, the Relative Strength Index (RSI) has surpassed its previous swing high, further boosting sentiment. The overall outlook remains positive, with Nifty likely to move toward 23,400 and beyond, while immediate support is seen at 23,000," he added.

Midcaps, Smallcaps Extend Gains

The broader market mirrored the gains in frontline indices, with the Nifty Midcap 100 climbing 0.64 percent and the Nifty Smallcap 100 rising 0.7 percent. Market breadth remained strong as 2289 shares advanced, 1575 shares declined and 110 shares unchanged. The BSE advance-decline ratio stood at a healthy 1.50, reflecting sustained buying interest in mid and smallcap segments.

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