This week, Indian stock markets experienced notable fluctuations, with swings ranging from 6% to 8% in both directions. The ongoing U.S.-China tariff conflict has kept investors on edge, leading to increased market volatility. A momentary boost came from President Donald Trump’s decision to pause the imposition of hefty U.S. tariffs, which briefly lifted market spirits. However, the underlying geopolitical tensions continue to pose challenges, limiting any significant upward movement in stocks.
Market Performance Overview
The Nifty 50 ended the week slightly down, with a decrease of 0.33%. It began the week around 22,800, dropped to a low of 21,700, and managed to rebound back to close near its starting point. Similarly, the Bank Nifty also faced a decline, slipping by 0.97% throughout the week.
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Nifty 50 Weekly Movement:
- Opened at: 22,800
- Lowest point: 21,700
- Closed at: 22,800
- Bank Nifty Weekly Movement:
- Closed down by: 0.97%
Technical Insights
Looking at the weekly chart, Nifty is exhibiting a lower-high pattern, indicating a cautious market sentiment. On a daily basis, the index has yet to surpass its 200 EMA and close above the monthly high, further reinforcing a sideways market outlook.
- Resistance Levels: 23,500–23,600
- Critical Support Zones:
- 22,800–23,000: If Nifty fails to maintain this range, it risks declining to 22,100–22,300.
- Major Support: 21,700, aligning with the 23.6% Fibonacci retracement from the COVID-19 low.
Despite the ups and downs, experts suggest a buy-on-dips strategy as long as Nifty stays above the 21,700–22,000 range. The next key resistance levels to watch are 23,600 and 24,000.
Bank Nifty Outlook
The Bank Nifty has shown resilience, especially if it maintains above the crucial 50,000 mark on a weekly closing basis, which coincides with its 200 EMA. If it sustains this level, a potential rally towards 52,000–53,000 could be in the cards. Investors are encouraged to adopt a buy-on-dips approach, particularly near significant support points, while exploring stock-specific opportunities within the index.
Key Levels to Watch
Both the Nifty and Bank Nifty managed to close above their respective monthly support zones, which are 22,100 for Nifty and 50,000 for Bank Nifty. The immediate support levels are now crucial for making new long positions:
- Nifty Support: 21,700
- Bank Nifty Support: 49,000
Traders should adopt a cautious yet opportunistic mindset, closely tracking these support levels for insights on market direction.
Recommended Stocks to Consider
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RBI Bank Ltd. (RBLBANK):
- Buy Range: ₹170-173
- Target: ₹180
- Stop Loss: ₹164
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DLF Ltd. (DLF):
- Buy Range: ₹620-630
- Target: ₹670
- Stop Loss: ₹590
- REC Ltd. (RECLTD):
- Buy Range: ₹398-404
- Target: ₹420
- Stop Loss: ₹394
In conclusion, as the market navigates through uncertainty, maintaining a strategic approach with an eye on critical support levels will be essential for traders and investors alike.
