This Week's Trade Guide: Stock Market Outlook; Nifty, Bank Nifty Support Levels - Technical Analysis!

Going by the charts of Gift Nifty's early performance, the Indian market may see a cautious opening on Monday. Volatile trends are likely to be stored in the day as global cues traded bearish. The market will see the influence of foreign and domestic funds flow, upcoming inflation data in both India and the USA, coupled with anticipations of rate cuts, Japan's economic growth and the February payrolls which came in softer.

At home, the key trends would be CPI and WPI inflation, along with IIP data this week. Further, FPIs/FIIs movement in equities, forthcoming policy rate guidance releases, and upcoming general elections voting.

Monday's Trade Guide:

As per EquiChin Wealth Advisors, Nifty RSI @ 64.56 & RSI average @ 61.66. Nifty continue to indicate strength and is likely to test 22627 in this week's opening.

Banknifty RSI @ 63.39 & RSI average @ 59.57. Banknifty is likely to test 48161 & 48535 on the upside and 47437 to act as the support level, the brokerage added.

This Week's Guide:

On the weekly outlook, Equichain's note added, this week's global market including the Indian market is trading at a fresh 52-week high and momentum is likely to see positive triggers in the coming weeks. The next U.S. Fed meeting is scheduled for 20-Mar-24 and incoming jobs & inflation data are likely to provide much-needed cues ahead of the next US FOMC meeting.

"We have maintained our exposure around 65% - 75% and would prefer to increase deployment gradually with stock specific approach. The market continues its uptrend and momentum could get strong if it is supported by the action of central banks which could lead to short covering rally ahead of financial year-end," the brokerage added.

For the week, the brokerage believes that the Nifty range is seen at 22334 to 22627 and Nifty above 22627 could provide fresh upside triggers. While Bank Nifty range is seen at 47206 to 48535. Banknifty has outperformed this week and outperformance is likely to continue.

Giving a technical view, Equichain's note added, "Technical trend continues to remain positive and Nifty @ 22627 & Banknifty @ 48161 to act as resistance. If Indices manage to move above these levels, it could further trigger short covering rallies and indices could test higher levels in this week on Nifty @ 22921 & Banknifty @ 48535. Nifty @ 22334 & Banknifty @ 47437 to act as a support level for this week."

Also, Vinod Nair, Head of Research, at Geojit Financial Services said, "The ECB kept the rate status quo and will wait for further evidence confirming inflation control. The release of US payroll data and upcoming inflation data from the US, China, and India next week will provide investors with insights into the global macroeconomic outlook. We expect volatility to persist in the upcoming week due to high valuations and forthcoming policy rate guidance releases."

Additionally, the brokerage added, that global sentiment is turning positive ahead of the next round of central banks' meeting which starts with the Bank of Japan on 19-Mar-24, the U.S. Fed on 20-Mar-24 & Bank of England on 21-Mar-24. The recent rally in Gold, the US 10-year bond yield below 4.10% & Dollar index below 103 - market rally on hope of a rate cut by the US Fed by in May 2024. ECB kept the interest rate unchanged on 7-Mar-24 and guided for a rate cut in June 2024 depending on incoming data. BOJ is expected to hike the rate on 19-Mar-24.

Finally, Equichan's note said, "We will use any correction to add/deploy funds and the recent trend looks positive. Market not expecting any change in rate in this month, but guidance on rate cut in coming months or likely by May 2024 meeting could provide much-needed trigger and rally."

After the market hours on Thursday, the Sensex rose by 33 points, reaching 74,119, while the Nifty gained 20 points to settle at 22,494. However, the Nifty Bank saw a break in its six-day winning streak, falling 130 points to 47,836, even as the Midcap Index experienced a positive upswing, gaining 109 points to reach 48,966.

Disclaimer: The write-up highlights is just for information purposes, and is not a recommendation to buy, sell or hold. We have not done fundamental or technical analysis and have no opinion on the stock market. Neither, the author nor Greynium Information Technologies should be held liable for any losses. Please consult a professional advisor.