Trade Setup For Aug. 26: Nifty Set For Gradual Uptick With Resistance At 24,960-25,080

The NSE Nifty 50 is poised for a gradual uptick in the coming week, with analysts projecting stock-specific actions to dominate the market. On the upside, resistance levels around 24,960 and 25,080 are expected to be key points, according to market experts.

"On the downside, the 21-Day Exponential Moving Average, positioned near 24,510, will act as strong support. As long as the index holds above 24,500, a 'buy on dips' strategy should be employed. On the upside, levels around 24,960 and 25,080 will act as resistance points for Nifty," according to Hrishikesh Yedve, AVP technical and derivatives research at Asit C. Mehta Investment Interrmediates Ltd.

Overcoming the bearish gap on the daily chart within the 24,850-24,950 range will require prudence rather than complacency, said Osho Krishan, senior analyst, technical and derivatives at Angel One Ltd. Breaking these levels could potentially lead the Nifty to new lifetime highs, he said.

"On the lower end, there has been an ascend to the support zone, starting from 24,750-24,700, followed by 24,650-24,600 with anticipation of dips auguring well for the bulls," Krishan said.

We expect the market to witness a gradual uptick with stock-specific action, said Siddhartha Khemka, head of retail research, Motilal Oswal Financial Services Ltd.

The Bank Nifty settled the day on a negative note at 50,933 levels.

"Technically, the Bank Nifty has formed a red candle near the trend line resistance around 51,200 levels. However, the index managed to hold above its 21-DEMA support, which is placed near 50,790 levels. On the weekly scale, the index has formed a bullish candle, indicating strength," said Yedve.

As long as the index holds above 50,790, a 'buy on dips' strategy is advisable, according to him. On the upside, trend line resistance near 51,200 levels remains a key barrier. Sustaining above 51,200 could open the path towards the 51,500 to 51,800 levels, he said.

The GIFT Nifty, an early indicator of the Nifty 50 Index’s performance in India, was down 6 points or 0.02% at 24,912 as of 6:41 a.m.

The Nifty August futures were up 0.05% at 24,854, a premium of 31 points, with open interest up by 3.5%.

The Nifty Bank August futures were down by 0.14% to 50,966 at a premium of 33 points, while its open interest was down by 8%.

The open interest distribution for the Nifty 50 Aug. 22 expiry series indicated most activity at 26,000 call strikes, with 24,000 put strikes having maximum open interest.

For the Bank Nifty options expiry on Aug. 28, the maximum call open interest was at 51,000 and the maximum put open interest was at 51,000.

Overseas investors stayed net buyers of Indian equities on Friday for the second straight day.

Foreign portfolio investors bought stocks worth Rs 1,944.5 crore, domestic institutional investors stayed net buyers for the 15th session and bought equities worth Rs 2,896 crore, the NSE data showed.

India's benchmark stock indices ended the muted session little changed on Friday.

The NSE Nifty 50 ended 11.65 points, or 0.05% higher at 24,823.15, and the S&P BSE Sensex closed up 33.02 points, or 0.04% at 81,086.21. During the day, Nifty rose 0.19% to 24,858.40, and Sensex was up 0.22% at 81,231.49.

Broader indices ended mixed, with the BSE Midcap ending 0.7% lower and the BSE Smallcap settling 0.15% higher on Friday.

Nine out of 20 sectoral indices on the BSE ended higher and 11 declined. BSE Realty was the top loser.

• Ambuja Cements: Adani Group promoter arm Holderind Investments sold a 2.8% stake, or 6.79 crore shares, for Rs 4,250 crore in Ambuja Cements. GQG Partners has picked up 1.7 crore Ambuja Cements' shares at Rs 625.5 per share, which totals to Rs 1,068 crore, through an open market transaction on Friday.

• KEC International: The company received new order worth Rs 1,079 crore in transmission and distribution and cable businesses.

• Religare Enterprises: ED officials conducted a search at premises of Executive Chairperson Rashmi Saluja, Group Chief Financial Offer Nitin Agarwal, General Counsel Nishant Singhal and Religare Finvest Chief Operating Officer Chirag Jain. ED has frozen the ESOP shares of unit care health insurance received by Rashmi Saluja, Nitin Aggarwal and Nishant Singhal.

• Nykaa: Investor Harindarpal Singh Banga offloaded 1.43% stake in Nykaa parent FSN E-Commerce Ventures Ltd. for Rs 851 crore through an open market transaction on Friday. Banga sold 4.08 crore shares at Rs 208.30 apiece, taking the transaction value to Rs 851.5 crore.

• Dr Reddy’s: US FDA completed product-specific pre-approval inspection at manufacturing facility in Andhra Pradesh and issued form 483 with three observations.

• Karur Vysya Bank: SBI Mutual Fund received RBI nod to acquired 9.99% stake in the bank.

Asian stocks began the week mixed even after the US Federal Reserve Chair said that the "time has come" for September rate cuts leaving traders to debate on the size of the cuts.

Futures contracts of benchmarks in Japan and South Korea were down while those in Hang Seng were higher. Meanwhile, the Nikkei 225 was 1.38% lower at 37,287, and the S&P ASX 200 was 0.60% higher at 8,072 as of 6:27 a.m.

Tensions in West Asia flared up as Israel declared a 48-hour state of emergency after launching a pre-emptive strike on Hezbollah sites in southern Lebanon. This comes as Hamas prepared its response to last month’s killing of its military chief.

Jerome Powell reinforced expectations on Friday that the world's largest economy will see rate cuts in September as inflation is on track to the 2% target.

The "time has come for policy to adjust" and the Fed does not seek or welcome further labour market cooling, he said in the keynote address at the Jackson Hole Symposium. "My confidence has grown that inflation is on the path to 2%."

As Powell cemented a rate cut next month US stocks rallied while bond yields tumbled on Friday. The S&P 500 and Nasdaq Composite surged 1.15% and 1.47%, respectively. The Dow Jones Industrial Average climbed 1.14%.

Brent crude was trading 0.72% higher at $79.59 a barrel as of 06:37 a.m. Gold rose 0.06% to $2,514.22 an ounce.

• U.S. Dollar Index at 100.58.

• U.S. 10-year bond yield at 3.77%.

• Brent crude up 0.72% at $79.59 per barrel.

• Bitcoin was up 0.16% at $64,348.51.

• Gold was rose 0.06% at $2,514.22.

The Indian rupee closed stronger against the US dollar on Friday, tracking the slight easing in the greenback and likely intervention by the Reserve Bank of India beyond Rs 84 in the previous session.

The local currency appreciated 5 paise to close at 83.90. It opened at an intraday high of 83.86 per dollar. The rupee had closed at Rs 83.95 on Thursday.