Indian benchmark indices, the Sensex and the Nifty 50, extended their winning streak to a third straight session on Friday, July 31, supported by mixed global cues and easing crude oil prices. The Sensex climbed 166 points, or 0.21%, to close at 78,094.64, while the Nifty 50 gained 66 points, or 0.27%, to settle at 24,383.60.
The Indian equity benchmarks ended the week on a strong positive note, with the Nifty 50 closing at 24,383, registering a weekly gain of 2.59%, while the Bank Nifty settled at 57,264, advancing by nearly 1%. Sectoral performance remained robust throughout the week, led by Information Technology, Automobiles, New-Age businesses, Financial Services, Pharmaceuticals, and Oil & Gas, all of which delivered gains in the range of 3%–5%, reflecting broad-based buying interest across the market.
According to Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi, the Nifty continued to exhibit resilience after successfully defending the 23,800 support level highlighted in the previous outlook. Last week, the index had failed to surpass the 24,500–24,600 resistance zone, which coincides with the 200-day Exponential Moving Average (EMA) and continues to act as a significant technical hurdle. However, the market structure remained constructive, as the index held its long-term trendline support in the 23,700–23,800 zone on the weekly chart, while the monthly chart continued to display a healthy higher-low formation, indicating that the primary uptrend remains intact.
“The Indian equity benchmarks ended the week on a strong positive note, with the Nifty 50 closing at 24,383, registering a weekly gain of 2.59%, while the Bank Nifty settled at 57,264, advancing by nearly 1%.”
Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi
Looking ahead, derivative data suggests that the Nifty has entered an overbought zone on the weekly chart following the recent sharp rally. Nevertheless, the broader technical structure continues to remain positive. Therefore, we maintain our buy-on-dips strategy, as any corrective decline is likely to attract buying interest. The index is expected to trade within the 23,800–24,600 range during the coming week, while the 23,500–23,600 zone is expected to provide strong medium-term support. A decisive breakout and sustained close above 24,600 would represent a major technical trigger, potentially accelerating the next leg of the rally towards the 25,000 mark.
On the Bank Nifty outlook, Dongre said that the index also maintained its positive bias during the week, rising nearly 1% to close around the 57,300 mark after witnessing a strong rebound from its 200-day EMA. The index continues to hold this crucial support, reinforcing a constructive medium-term outlook. However, a decisive and sustained breakout above the 58,000–58,500 resistance zone is essential to trigger fresh buying momentum and open the path towards the 60,000 mark. Until such a breakout occurs, the index is likely to remain in a consolidation phase.
“Looking ahead, derivative data suggests that the Nifty has entered an overbought zone on the weekly chart following the recent sharp rally.”
Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi
Background
The Indian stock market has been experiencing a positive trend, supported by easing crude oil prices and mixed global cues. The resilience of key indices like the Nifty and Bank Nifty, along with strong sectoral performances, has bolstered investor confidence.
As the Indian stock market continues to show resilience, investors are advised to keep an eye on key technical levels and sectoral performances. The ongoing positive sentiment, driven by strong sectoral gains and technical indicators, suggests a promising outlook for the coming weeks.
