The Indian stock market is set to continue its upward trajectory with the benchmark indices, Sensex and Nifty 50, anticipated to open with modest gains on Tuesday. This positive outlook comes amid a backdrop of mixed signals from global markets. Notably, the GIFT Nifty also hints at a stable start for Indian indices, suggesting investor optimism.
Recent Market Performance
In the last trading session, the domestic equity market exhibited a robust rally. The Nifty 50 impressively closed above 24,300, marking a significant milestone. The Sensex surged by 1,005.84 points, or 1.27%, finishing at 80,218.37. Meanwhile, the Nifty 50 gained 289.15 points, or 1.20%, closing at 24,328.50.
Nifty Options Analysis
Chandan Taparia, the Head of Derivatives and Technicals at MOFSL Wealth Management, provided insights into the Nifty options landscape. He noted that the maximum Call Open Interest (OI) is concentrated at the 25,000 and 24,500 strikes, while the maximum Put OI is seen at 24,000 and 24,200 strikes.
- Call writing is evident at 24,500 and 25,000 strikes.
- Put writing is observed at 24,000 and 24,200 strikes.
According to Taparia, the option data indicates a broader trading range between 24,000 and 25,000, with an immediate focus on the 24,200 to 24,600 levels.
Nifty 50 Outlook
The Nifty 50 index displayed strength from the onset of the previous session, gradually climbing throughout the day. Although it struggled to maintain levels above 24,350, bullish momentum quickly absorbed any downward pressure.
- Taparia remarked, "The Nifty 50 formed a bullish candle and an inside bar on the daily frame, closing with gains of around 290 points. Holding above 24,200 is crucial for a potential move toward 24,500 and 24,650, with support levels adjusting higher to 24,200 and 24,050."
Bank Nifty Analysis
The Bank Nifty index also demonstrated a positive trend, forming a bullish candle and reversing its previous lower highs, closing around 55,450 with gains of approximately 770 points.
- "The long-term trend for this rate-sensitive index remains favorable, indicating buying interest at lower levels. For further upward movement towards 56,000 and potentially a new all-time high of 56,500, it must hold above 55,250," Taparia advised.
Stock Recommendations
Chandan Taparia has identified three notable stocks to consider buying:
-
Sun Pharmaceutical Industries
- Target Price: ₹1,950
- Stop Loss: ₹1,785
- Taparia noted the stock has broken out of a double bottom pattern, with positive momentum confirmed by a rising RSI.
-
Hindustan Aeronautics Ltd (HAL)
- Target Price: ₹4,730
- Stop Loss: ₹4,270
- The stock has exhibited a range breakout with increasing buying volumes, as per Taparia’s analysis.
- Indian Bank
- Target Price: ₹622
- Stop Loss: ₹570
- The stock has recently retested its breakout from a consolidation zone, supported by a rising MACD.
In conclusion, the Indian stock market appears poised for further gains, bolstered by strong performances from key indices and promising stock recommendations. Investors should stay vigilant and consider these insights as they navigate their trading strategies.
