Foreign institutional investors (FIIs) have made a comeback to the cash market after a nearly month-long hiatus, raising hopes among market watchers. The pivotal question remains: will the Nifty 50 breach the 23,000 mark this week? Many analysts view this level as a significant resistance point. Yet, there’s optimism in the air, fueled by favorable global developments, including the Bank of Japan maintaining its key lending rates and savvy investors capitalizing on lower entry points.

Bulls Charge Back into the Market

Tuesday’s trading session showcased a robust performance, signaling a potential breakout for the Nifty 50. Ajit Mishra, Senior Vice President of Research at Religare Broking, noted that the synergy between the benchmark index and major banking stocks could bolster further gains, with the Nifty 50 now setting its sights on 23,100.

• Key Highlights:
  • Foreign institutional investors are returning after a prolonged absence.
  • The Nifty 50 is targeting the 23,100 level.
  • Positive global cues are influencing market sentiment.

Positive Global Influences

The domestic market is poised for an uplift thanks to encouraging signals from abroad. The Bank of Japan recently opted to maintain its interest rates at 0.50%, aligning with investor expectations. Siddhartha Khemka, Head of Research and Wealth Management at Motilal Oswal Financial Services, stated, “Investors will be keenly observing the Federal Reserve’s forthcoming economic outlook and comments for guidance on future trends. We anticipate ongoing market recovery, bolstered by robust global cues and strategic value buying.”

Short-Covering Rally in Sight

Jatin Gedia, a Technical Research Analyst at Mirae Asset Sharekhan, expressed optimism for the next several trading sessions, suggesting that a short-covering rally might propel the Nifty towards the 22,800–23,000 range in the short term. “The 20-day moving average at 22,561 serves as a critical barrier, and closing above this level could strengthen the current upward momentum,” he explained.

Market Outlook from Experts

Shrikant Chouhan, Head of Equity Research at Kotak Securities, reiterated the bullish sentiment prevailing in the market right now. He pointed out that the market is comfortably trading above the 20-day Simple Moving Average, indicating potential for further growth from current levels.

However, caution is warranted, as Samco Securities highlighted, “Intense call writing at 23,000 indicates a strong resistance zone. Traders should prepare for minimal downside reactions while observing robust buying pressure on the upside.”

What Lies Ahead?

As the market gears up for the week, all eyes will be on forthcoming updates from the Federal Reserve and how they may influence trading strategies. The dynamics at play suggest that while challenges remain, the overall sentiment is leaning towards optimism as investors navigate this exciting phase.

Stay informed and keep an eye on the evolving market trends as we move forward into the week!