Trading at Gift Nifty signals a minor gain for Indian markets at the opening. Following a robust pullback rally, analysts are anticipating fresh signals for further consolidation. They foresee continued stock-specific action and expect significant investors to engage in sector rotation ahead of the new fiscal year. Despite the negative close of the US markets overnight, most equities in the Asia Pacific region are trading higher in early deals.
Analysts note that the market is currently lacking a new movement trigger as investors are gradually adjusting to uncertainties arising from the US administration.
IT stocks are expected to remain in focus following Accenture’s results. While the results exceeded expectations, the IT giant’s cautious outlook triggered panic selling in the stock, causing it to drop nearly 7% in the Nasdaq.
On the other hand, foreign portfolio investors have started accumulating Indian stocks. After being sellers until recently, FPIs have now turned into buyers. On Thursday, they purchased shares worth over ₹3,000 crore, indicating that the worst of the selling by FPIs may be over. However, analysts believe that meaningful buying will only occur once there is clarity on the tariff front.
Moreover, the derivative market suggests that the momentum will persist.
According to Chandan Taparia, Head of Derivatives & Technicals at Wealth Management, Motilal Oswal Financial Services Ltd, the FII long-short ratio has increased to 25%, indicating a short covering trigger in the market. He also mentioned that the increasing Put Call Ratio from the lower zone and declining India Vix indicate buying at lower levels. Taparia pointed out that the market must stay above the 23000 zones for an upward movement towards 23333 and then 23500 zones, with support levels at 23000 and 22800 zones. Options data suggests a wider trading range between 22800 to 23800 zones and an immediate range between 23000 to 23400 levels.
From a technical perspective, experts believe that the market is likely to sustain the broad rally.
Rajesh Bhosale, Equity Technical Analyst at Angel One, stated that the correction that started in September from 26277 saw each bounce being sold into along a descending trendline. However, he noted that this session’s decisive breakout above this trendline confirms a “Falling Channel” pattern. Bhosale highlighted that the RSI has crossed above 50 and is close to breaking its previous swing high, signaling a shift in momentum towards the bulls. He cautioned traders to avoid complacent bets, be selective, and utilize minor dips as buying opportunities.
Published on March 21, 2025.
