The Nifty is positioned for potential fresh highs this week as two key sectors flash encouraging bullish signals according to latest market analysis. The Nifty Realty Index has delivered a strong breakout from a prolonged consolidation phase on both daily and weekly charts, reinforcing its broader uptrend continuation. Meanwhile, the Nifty PSE Index is showing encouraging indications that its recent corrective phase may be approaching its end, with the index attempting to establish stability above the important support region of 9,750-9,800. Market momentum indicators continue to support the positive outlook, with the weekly RSI comfortably holding above the 60 level for realty stocks and the weekly RSI declining toward the 45 mark but holding above previous swing lows for PSE.
The Nifty Realty Index has delivered a decisive breakout from its prolonged consolidation phase, highlighting strengthening bullish sentiment and buyer control. The breakout is backed by strong momentum indicators with the weekly RSI comfortably holding above the 60 level, reflecting healthy trend strength and indicating potential for further upside. Nearly 80% of near out-of-the-money Put strikes witnessed fresh short build-up, while a similar proportion of near OTM Call strikes saw long additions, signalling expectations of higher prices ahead. Additionally, close to 60% of realty stocks registered short covering on a week-on-week basis, indicating that market participants are reducing bearish positions and increasingly positioning for upside opportunities. As long as the breakout zone remains intact, the index appears well positioned to advance towards its near-term upside targets of 960 and 1,000 over the coming weeks.
The Nifty PSE Index is showing encouraging indications that its recent corrective phase may be approaching its end, with the index retracing towards the lower boundary of its rising channel and attempting to establish stability above the important support region of 9,750-9,800. The weekly RSI has declined toward the 45 mark but continues to hold above previous swing lows, suggesting that downside momentum is gradually losing strength. Although the MACD histogram remains in negative territory, it has begun to flatten, indicating that selling pressure is easing and bearish momentum is fading. The current rebound attempt is also taking place near the support of a widening wedge pattern, further reinforcing the significance of the prevailing support zone. A decisive breakout above the 10,100-10,200 resistance band would strengthen the case for a bullish reversal and could open the path for a move towards 10,700.
Anand James, chief market strategist at Geojit Investments, has identified three stocks showing early signs of bullish reversal according to reports from Business Standard. The recommendations include CMS Info Systems (LTP: ₹273), Aurionpro Solutions (LTP: ₹885), and Ashapura Minechem (LTP: ₹703). James is maintaining a bullish bias on these stocks based on technical analysis and momentum indicators. The analysis suggests these setups offer favorable risk-reward profiles supported by technical indicators and volume patterns, with specific target levels and stop losses established for each recommendation.
Despite recent volatility, 61% of the Nifty 500 have managed to close above their respective 10-day SMA, the highest level last week, suggesting strong risk appetite. Among sector-specific indices, media, auto and financial services indices are trading below their respective 10-day SMAs but not by large distances to be of concern. Foreign Institutional Investors (FIIs) increased their long positions in the index future segment to 34,427 contracts, with a 9% jump on Friday contributing to a 15% week-on-week rise. Short positions also declined during the period, easing 2.88% to 289,138 contracts, though bearish exposure remains relatively high with total short positions still around 3% higher compared with the previous week. The long-short ratio of FIIs in the index future segment is at 10.6, below both the 30-day mean and 90-day mean, indicating a recovery from near record lows.
