Bajaj Broking Market Closing Commentary
Benchmark indices ended lower in a volatile session, with the Nifty falling below 22,400, despite positive signals from industrial production and retail inflation data. The index closed the week down by 0.75%. On Friday, markets are closed due to Holi. The Nifty ended at 22,397.20, down by 73.30 points or 0.33%. Both the BSE Midcap and Smallcap indices dropped by 0.7% each. Sectorally, auto, IT, metal, media, and realty stocks saw declines of 0.5-1%, while the PSU Bank index gained 0.5%.
Nifty Outlook
Index extended decline and closed lower by 0.3%. It has formed a bear candle which remained enclosed inside previous session high-low range highlighting consolidation with corrective bias. Nifty in the last three sessions is forming a base near the 50% retracement level of the previous upward move (21965-22676). Going ahead, index sustaining above 22,200-22,300 level is crucial for continuation of the pullback towards 22,700 & 23,000 levels in the upcoming week. A breach below 22,200 will lead to extension of decline towards the key short term support area of 22,000-21,700.
Bank Nifty Outlook
Bank Nifty started the session on a positive note but struggled to sustain at higher levels, giving up its gains to close the session on a flat note at 48055 levels. The index formed a bear candle with a higher high-low indicating consolidation near the lower band of the consolidation range observed over the past nine weeks. The index has been making lower highs and lower lows on the weekly chart for the past five weeks. To reverse the trend, it must break this pattern. Failing to do so will likely sustain a bearish outlook. The index is currently near the lower end of the 47,700-49,000-consolidation range. A close below the lower band of the range will lead to an acceleration of decline towards 47,000 levels in coming weeks. While holding above the same can lead to a pullback towards 49,000 levels.
Sundar Kewat, Technical and Derivatives Analyst, Ashika Institutional Equity – part of Ashika Group
Domestic economic data played a key role in shaping market sentiment today. Retail inflation eased more than expected, falling below the RBI’s target range for the first time in six months, fueling optimism about potential interest rate cuts. Additionally, industrial output surged beyond expectations in January, further boosting investor confidence.
The Nifty opened on a positive note at 22,541 but faced early selling pressure before recovering to an intraday high of 22,558. However, renewed selling dragged the index to an intraday low of 22,377 (as of 15:06). The session was marked by high volatility, with sharp fluctuations before the index settled near the day's low. Sector-wise, Capital Goods, Power, and Healthcare exhibited strength, while weakness was observed in Oil & Gas, Financial Services, Auto, and IT.
Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Interrmediates
Nifty commenced the day on a positive note, but after initial volatility, the index faced selling pressure and settled the session on a negative note at 22,397. The volatility index, India VIX, decreased by 3.01% to 13.28, indicating decline in market volatility.
Technically, on the daily chart, Nifty formed a red candle, signalling selling pressure. Over the past week, the index has been consolidating within the 22,300–23,700 range. Additionally, it is encountering resistance near the bearish gap of 22,668–22,720. As long as the index holds above 22,300, a pullback towards 22,600-22,700 remains possible. However, if Nifty breaches 22,300, the weakness could extend towards the 22,000 level. Traders should closely track these levels for potential trading opportunities.
Bank Nifty index opened on a positive note but failed to sustain higher levels, leading to profit booking, and ultimately closed flat at 48,060 levels. Technically, the Bank Nifty index formed a red candle on the daily scale while holding the key support level of 47,840. As long as Bank Nifty remains above 47,840, a relief rally could be possible. On the higher side, the 21-Days Exponential Moving Average (21-DEMA) is positioned near 48,620, serving as a key resistance level. However, a sustained break below 47,840 could trigger further weakness.
