Fundamental Overview
The Nifty 50 bounced around a key support recently and extended the gains today following the RBI’s rate cut. The central bank’s support is certainly a good thing for the stock market.
The aggressive US tariffs have been one of the main negative factors for India this year. The tariffs haven’t stopped the main upward trend but slowed down the momentum, nonetheless.
The US-India trade talks is something to always keep an eye on as a positive resolution should give a stronger boost to Indian equities.
Looking ahead, the main risk is the Fed releasing its policy decision next week. There’s a risk of a hawkish cut that could weigh on global risk sentiment and negatively impact the Indian stock market too.
If the Fed leans on the dovish side, then it will keep the positive risk sentiment intact and support the stock market.
Nifty 50 Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nifty 50 bounced around the trendline and extended the gains today following the RBI’s rate cut. The buyers will likely continue to lean on the trendline to keep pushing into new highs, while the sellers will look for a break lower to target a correction into the 25,317 level next.
Nifty 50 Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see more clearly the bounce at the support zone around 25,900 level as the buyers stepped in with a defined risk below the trendline to position for a rally into a new all-time high. The sellers should wait for a break below the support to gain more conviction and pile in for a drop into the 25,317 level next.
Nifty 50 Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that the optimal dip-buying opportunity was around the 25,900 support as flagged here. We can expect the buyers to remain in control for now with a pullback into the 26,100 support providing another opportunity. As long as the price remains above the trendline and the 25,900 support, the trend should be skewed to the upside.
Upcoming Catalysts
On Wednesday we have the FOMC rate decision.
