Market Poised For Gain As Nifty Eyes 24,336 Resistance Level, Says Analyst

Markets have another 2-3% upside, with the next resistance level for Nifty at around 24,336 in the short term, according to Jai Bala, founder and chief market technician at Cashthechaos.

India's benchmark stock indices closed higher on a weekly basis for the fourth consecutive week, marking the best month so far in 2024. However, on Friday, they snapped their four-day record run to end lower.

On Friday, the NSE Nifty 50 closed 33.90 points, or 0.14%, lower at 24,010.60, and the S&P BSE Sensex fell 210.45 points, or 0.27%, to 79,032.73. During the day, the Nifty touched a fresh record of 24,174, and the Sensex hit a lifetime high of 79,671.58.

Nifty Bank faces long-term resistance between 55,000 and 56,000, Bala said. "We might see a push towards 54,000 for the Nifty Bank index, despite today's decline. The long-term trendline from 2010 indicates resistance at 54,000 to 56,000, suggesting some upside but warranting extreme caution."

Private banks have some remaining upside potential, but he warned that this trend may be nearing its end. "I would anticipate resistance kicking in around 54,000 to 56,000 on the long-term trendline," Bala explained.

He emphasised the significant impact of global cues on Nifty, pointing out disparities between major US indices, and highlighted Nvidia's role in the artificial intelligence-driven market. "Nvidia is approaching significant resistance at around 145, having pulled back from 140," he said.

The dollar index is nearing 106.5, which could have substantial macroeconomic effects on commodities and stocks, he said. "The dollar index hit 106.2 and is cooling off. If it surpasses 106.5, it will have broad macroeconomic implications."

The market's reaction to tariff hikes by Bharti Airtel Ltd. and Reliance Jio Infocomm Ltd. can be attributed to profit-booking by investors, said Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services Ltd.

This tariff hike aligns with the long-term trend of improving average revenue per user across the telecom sector, bolstering his positive outlook on the industry.

While there might be an immediate market correction, it is a strategic entry point for investors who have not yet engaged with the telecom sector, Khemka said.

"The tariff hike is a significant step towards strengthening the financial health of telecom companies, ultimately benefiting the entire industry. This move is viewed as a confirmation of the sector's potential for sustained growth and profitability, reinforcing investor confidence in the long-term prospects of the telecom space," he said.

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