Trading at Gift Nifty signals a marginal gain for Indian markets at open. After a strong pullback rally, analysts await fresh signals for further consolidation. According to them, stock-specific action will continue, and big investors will indulge in sector rotation ahead of the new fiscal. Despite the negative closing of the US markets overnight, most equities in the Asia Pacific region are up in early deals.
According to analysts, the market currently lags behind a fresh movement trigger as investors are slowly adapting to uncertainties emanating from the US administration.
IT stocks will remain focused following Accenture’s results. Though the results were better than expected, the IT major’s cautious outlook triggered panic selling in the stock, which slumped nearly 7 per cent in the Nasdaq.
Meanwhile, foreign portfolio investors have started accumulating Indian stocks. FPIs, who were sellers until recently, have turned into buyers. On Thursday, they bought shares worth over ₹3,000 crore, signalling that the worst selling from FPIs may be over. However, analysts expect meaningful buying will come only when clarity emerges on the tariff front.
Meanwhile, the derivative market indicates that the momentum will continue.
According to Chandan Taparia, Head Derivatives & Technicals, Wealth Management, Motilal Oswal Financial Services Ltd, The FII long-short ratio has increased to 25 per cent, showing a short covering trigger in the market. “Increasing Put Call Ratio from lower zone and decreasing India Vix indicates buying at lower levels. Now it has to hold above 23000 zones for an up move towards 23333 then 23500 zones while supports can be seen at 23000 then 22800 zones,” he said. Options data suggests a broader trading range between 22800 to 23800 zones and an immediate range between 23000 to 23400 levels, he added.
From technical perspective also the market is likely to sustain the broad rally, experts opined.
Rajesh Bhosale, Equity Technical Analyst, Angel One, said the correction that began in September from 26277 saw every bounce getting sold into along a descending trendline. However, this session’s decisive breakout above this trendline confirms a “Falling Channel” pattern. “Additionally, the RSI smoothened has crossed above 50 and is on the verge of breaking its previous swing high, signaling a shift in momentum toward the bulls. That said, the low-hanging fruits have already gone, and after such a sharp move, some consolidation or a slower pace is likely. Traders should avoid complacent bets, be selective, and use minor dips as buying opportunities,” he added.
