Nifty Bulls Stage Comeback on Dalal Street, Eye Critical 25,000–25,200 Resistance Zone Ahead.

The Indian equity markets demonstrated strong upward momentum during the past week, following a notable rally that coincided with the aftermath of the US midterm elections. The Nifty index surged by 1,977.25 points, marking a substantial gain of 8.58%, with trading activity characterized by a wide range of 1,823.30 points. The positive market sentiment was reflected in the increase in volatility, evidenced by the India VIX rising by 14.18% to reach 17.47. A critical technical rebound occurred near the key long-term support level of 22,700-22,800, allowing the Nifty to regain its position above key moving averages, thus improving the overall market outlook.

As the Nifty approaches a resistance zone between 25,000 and 25,200, market participants may observe some necessary consolidation after the recent dramatic rise. The current gains have positioned the index near the upper Bollinger Band, indicating potential overextension in the short term. Although the weekly RSI is neutral at 60.96, showing no divergence against price movements, a positive crossover on the MACD further underscores bullish sentiment. Nonetheless, investors should exercise caution as the index navigates these critical resistance levels, where sustained movement is required to confirm further upward trends.

The Relative Rotation Graphs indicate that sectors such as PSU Banks and Financial Services are currently in the leading quadrant, suggesting potential outperformance relative to the broader market. Meanwhile, while the Realty index is witnessing improvements in relative momentum, sectors like MidCap 100, Auto, and Energy remain in the lagging quadrant, hinting at potential underperformance. Retail investors would be prudent to approach new investments selectively, particularly favoring sectors demonstrating upward momentum and maintaining appropriate risk management strategies as volatility persists in the market environment.

Source: The Economic Times

(Expert Note: This intelligence brief was structured and verified by the Wealthova editorial desk.)