After a gradual upside bounce on Tuesday, the Nifty 50 index extended its breather rally on Wednesday, trading in a range-bound manner between 23,150 and 23,300 levels. The index opened on a positive note and and shifted into a narrow range of movement, with volatility continuing throughout the session. Despite this, Nifty managed to hold above the 23,200 level, closing the day with minor gains of 37 points at 23,213.

The Midcap Index outperformed the Sensex and Nifty, although it closed off its intraday highs. Power stocks moved higher on expectations of increased budget allocations, with NTPC rising by 3%.

Shares of Kalyan Jewellers were locked in a 10% lower circuit on Wednesday. The stock has now declined by 32% over the last nine trading sessions, despite the company’s December quarter business update showing robust growth. Out of nine analysts covering the stock, eight have a ‘Buy’ rating, while one maintains a ‘Sell’ rating.

Thursday’s session will include the weekly expiry of Nifty 50 options contracts. Additionally, stocks like L&T Technology Services (LTTS), HDFC Life, and Transrail Lighting are expected to react to their quarterly results announced after market hours on Wednesday.

Investors will also focus on upcoming earnings reports from Reliance Industries, Infosys, LTIMindtree, and Axis Bank, which could provide directional cues for the market.

On the global front, the US CPI data (released on Wednesday) and the US retail sales data (due on Thursday) are expected to act as significant triggers, alongside ongoing Q3 earnings announcements.

The market seems to be pausing as recovery attempts face resistance, though select heavyweight stocks are limiting the downside, said Ajit Mishra – SVP, Research, Religare Broking.

What do the Nifty 50 charts indicate?

The Nifty continued its upward momentum today, adding 37 points (0.16%) to close at 23,213. The index encountered resistance today at its five-day exponential moving average near the 23,300 level.

Nagaraj Shetti of HDFC Securities expects the near-term trend of the Nifty to remain weak. A sustainable move above the hurdle 23,300-23,350 levels could further strengthen the upside bounce in the market. At the lows, 23,050 is going to be a crucial support for the market.

According to Om Mehra of SAMCO Securities, the Nifty is approaching towards the falling trendline, and a breakout above 23,320, or sustained trading beyond this level, could unleash strong bullish momentum. “On the downside, the Bollinger Band on the daily chart, positioned around 23,100, serves as critical support. Any pullback towards this zone could present a buying opportunity, reinforcing the bullish outlook as long as the 23,080 level holds firm.”

“The sentiment is likely to favor a recovery in the short term, with the potential to reach 23,400 on the higher end. The sentiment is expected to remain positive as long as the market stays above 23,000. A buy-on-dips strategy appears to work well in the current scenario,” said Rupak De of LKP Securities.

Looking ahead, key resistance levels for the Nifty are positioned at 23,340 and 23,500. On the downside, 23,047 continues to serve as a crucial short-term support level, below which the bearish trend could resume, said Devarsh Vakil, Head – Prime Research at HDFC Securities.

What do the Nifty Bank charts indicate?

The Nifty Bank index ended the session at 48,751.70, gaining a modest 0.05%. The index formed a Doji candle, with identical wicks on both the upper and lower sides. Nifty Bank is gradually inching closer to the 9 EMA, situated around 49,500, suggesting that a move towards this level could be in play. Additionally, the daily RSI is showing early signs of recovery from its recent lower levels, which could signal a potential shift in momentum, Mehra said.

“On the hourly chart, a base is forming around the 48,500 level, highlighting stability and a potential foundation for an upward move. A decisive break above 49,100 would suggest further upside, with the index likely to make a steady climb. The immediate support is positioned at 49,300, and a breach of this level would likely trigger a resumption of the downtrend, invalidating the bullish scenario,” he added.

Here are the stocks to watch ahead of Thursday’s trading session:

L&T Tech: In-line Operating Performance In Q3, Highest-ever Large Deal Bookings

HDFC Life: Q3 Above Estimates, Retains VNB & APE Growth Guidance.

Happiest Minds: Collaborates With Coca-Cola Vietnam For A GenAI Conversational Interface

RVNL: JV Bags Order Worth ₹3,622 Cr From BSNL For Middle Mile Network Of Bharat Net

GAIL: Settlement Agreement With SEFE Mktg & Trading S’pore Pte, To Receive $285 m

Hitachi Energy: To Consider Fund Raise On Jan 18, 2025 Via Various Routes

Transrail: Q2FY25 EBITDA Up 16.4%, Margin At 12.9% Vs 12.5% (YoY)

IRFC: Signs A Lease Agreement With NTPC For 8 BOBR Rakes Worth ₹250 Cr

Gensol Engg: Tie-up With Refex Green Mobility For The Transfer Of 2,997 Electric 4-wheeler

Azad Enng: Bags Contract Worth Approx ₹960 Cr From GE Vernova For Gas Turbine Engines

Man Industries: To Consider Fund Raising Via Preferential Issue On January 18, 2025

Antony Waste: Total Tonnage For Q3 Up 3.2% YoY At 1.18 mt

Shalby: Gets US FDA Premarket Notification Clearance For Knee Replacement Device

Minda Corp: ‘Combined Entity Will Grow By 10-12% In Overall Size, To Deliver Growth Plans Organically’

Nazara Tech: To Consider Fund Raise Via Pref Issue In Jan 20 Board Meet

CEAT: Margin Declines 380 bps, EBITDA Down 18.3% YoY

OFSS: Q3 Revenue Growth Down 5.9%, Margin At 41.60% Vs 47.60% (YoY)