Indian equity benchmarks are expected to begin Tuesday’s session on a muted note, with early signals from Gift Nifty hinting at a mildly positive opening. Gift Nifty was trading around the 24,707, a modest 22-point premium over Nifty futures’ previous close, suggesting a flat to slightly higher start for domestic markets.
On Monday, the losing streak in equities stretched to a seventh straight session as persistent selling pressure weighed on sentiment. Sensex slipped 61 points, or 0.08%, to 80,364.94, while Nifty 50 ended 19.80 points lower at 24,634.90, slipping beneath the 24,700 level.
Concerns over global cues, weak institutional flows, and caution ahead of the Reserve Bank of India’s (RBI) policy meeting kept investors on the sidelines.
Technical indicators remain weak for the Sensex. Analysts note that the index has been creating consecutive lower tops on intraday charts, and bearish momentum remains intact. Immediate resistance is located close to 80,800; a breakout above this region could trigger a short-covering rally towards 81,000-81,300.
On the downside, support is located at 80,300, below which the index could slide further toward the 80,000-79,800 range. Traders are advised to stay cautious, with the RBI’s monetary stance likely to set the tone for the coming sessions.
Nifty 50 also flashed weakness after forming a bearish candle with an upper shadow, signaling an inability of bulls to sustain intraday recoveries. Analysts see 24500-24400 as the next key support level, with resistance being held around the 24800-24900 range.
A failure to hold this support level may lead to an increase in selling pressure, while a breakout above this level could pave the way towards the 25000 mark. With the monthly F&O expiry now behind us, we could also see elevated volatility.
The Bank Nifty closed at 54,461, gaining 71 points, and forming a Doji candlestick on the daily chart, representing uncertainty among traders. Analysts believe 54,100-54,000 could act as an important support area, and resistance is at 54,700-54,900.
If support is broken, the index could reach 53,800, where the 200-day EMA lies; however, a breakout above the resistance could lead to a more sustained recovery.
The upcoming RBI policy meeting will be crucial for market direction. While the consensus among economists is that the repo rate will remain at 5.5%, some predict a 25-basis-point reduction because inflation is easing and growth concerns are elevated due to tariffs in the US.
Other headwinds include a record-low rupee, volatile crude oil prices, persistent FII outflows, and global macroeconomic uncertainty.
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