The market has a mind of its own. On a day when the street expected a repeat of Friday’s declines courtesy of the sell-off on Wall Street, the Nifty ended higher. The Nifty ended higher on Tuesday as well, but then the gains were not as much as the street anticipated, considering the strong handover from across the Atlantic.

The Nifty did cross 25,000 and even 25,100 intraday on Tuesday, but could not sustain above those levels. There was some resistance seen at the 25,150 mark, which led to the index turning from its intraday high of 25,130, and ended 90-points off the day’s high.

Nifty’s price action almost makes it come across as if the bulls are treading every step with caution and not throwing caution to the wind. There is some very important data and events lined up in the next one week and they may want to take it easy for the time being. The US CPI and PPI data gets reported over Wednesday and Thursday, while the Federal Reserve’s rate decision will also be announced next week.

Tuesday’s session belonged to IT and Pharma companies. A slew of brokerages have come out with notes on the future of the IT sector. You can read more on that here. Pharma companies also had a healthy day of gains, mainly due to the passage of the Biosecure Act in the US House of Representatives. The impact of the same on Indian Pharma companies can be read here.

The next two sessions are crucial for the index. Wednesday will be the weekly expiry of the Nifty Bank, while the Nifty’s weekly contracts expire on Thursday. Broader markets also staged a rebound after Monday’s underperformance.

Which brings us to some important questions ahead of Wednesday’s trading session:

• Can this two-day gain on the Nifty be termed a “recovery” or a bounce that cannot be sustained?
• Will the market continue to remain choppy until the FOMC rate decision?
• Will the Nifty get a directional move on Wednesday on the Nifty Bank weekly expiry day?
• Are traders using this recovery to utilise the “sell-on-rallies” template on the Nifty?

Foreign Institutions were net buyers in the cash market on Tuesday, while domestic institutions were net sellers.

Rajesh Bhosale of Angel One believes that the Nifty is facing the looming “Bearish Engulfing” pattern from last week. The current upward move is marked by small candles, which means traders should avoid complacency, he said. The Nifty appears to have entered a consolidation phase with 24,900 – 24,800 as support and 25,200 – 25,300 as resistance. He advises traders to adopt a buy-on-dips, sell-on-rallies strategy.

Nifty faces a crucial resistance at 25,200 levels, said Nagaraj Shetti of HDFC Securities. A decisive move above this can open further upside towards new all-time highs with immediate support at 24,900, he added.

LKP Securities’ Rupak De said that the Nifty’s RSI remained in a bearish crossover and he expects the sentiment to remain weak till the Nifty closes above 25,100. In case the Nifty slips below its support at 24,900, it may fall to levels of 24,750.

The weekly expiry of the Financial Services index on Tuesday meant that the Nifty Bank continued to remain in the spotlight after Monday’s upmove. The index tested levels of 51,400 on the upside, but could not sustain above those. However, it did manage to close above the 51,250 mark, which can be counted as a positive. Wednesday will also be an important session for the index as it will be its weekly expiry.

The Nifty Bank manages to hold above the piercing line candle, said Hrishikesh Yedve of Asit C Mehta Investment Interrmediates. In case the index manages to sustain above 51,400, he expects a move towards 51,800 – 52,000 in the short-term. On the downside, immediate support is at the 50-Day Exponential Moving Average at 50,950, followed by the low of the piercing line candle, which is at 50,370.

Aditya Agarwal of Sanctum Wealth said that the Nifty Bank will continue to face resistance around 51,500 – 51,700 levels and it can see profit booking around those levels. He said that only a close above 51,800 will change the short-term outlook around the Nifty Bank and it can move towards 52,280 – 52,460 levels. 51,000 – 50,700 on the downside will see support.

What Are The F&O Cues Indicating?

These stocks saw addition of fresh long positions on Tuesday, meaning an increase in both price and Open Interest:

Stock	Price Change	OI Change
Divis Laboratories	4.57%	34.87%
Atul	0.64%	21.18%
Indian Hotels	4.34%	11.19%
Coforge	4.99%	10.30%
IndiaMART	2.98%	9.90%

Short covering was seen in these stocks on Tuesday, meaning an increase in price but a decline in Open Interest:

Stock	Price Change	OI Change
Granules India	3.29%	-8.56%
Tata Power	6.90%	-7.32%
Dabur	0.28%	-6.54%
L&T Technology Services	2.14%	-5.69%
Power Grid	1.69%	-5.27%

These are the stocks to watch out for ahead of Wednesday’s trading session:

• Reliance Industries: Reliance Retail Ventures & Delta Galil announce strategic partnership in India. With this collaboration, Delta Galil will expand its presence in India with a 50:50 Joint Venture.
• Dr. Reddy’s Laboratories: Clarifies on allegations of engagement with Agora Advisory, says that services of Dhaval Buch were engaged frmo October 2020 to April 2021 for a total remuneration of ₹6.58 lakh. The assignment started an ended well before Madhabi Puri Buch’s term as SEBI Chairperson began. Any suggestion that the company was treated differently by SEBI as a result of this would be baseless and malafide.
• Pidilite: Clarifies on association with Dhaval Buch, Agora Advisory, saying that had engaged services of Dhaval Buch in FY20 and that there has never been any enquiries or cases from SEBI vis-a-vis the company.
• Oil India: Oil India, ONGC Videsh and KABIL sign MoU with IRH, UAE for Global Cooperation in Critical Mineral Supply Chain.
• IREDA: Arm IREDA Global Green Energy Finance IFSC gets provisional registration from the International Finance Services Centre Authority (IFSCA) as a finance company at GIFT City.
• Jubilant Pharmova: USFDA classifies arm Jubilant HollisterStier LLC’s contract manufacturing facility at Spokane, Washington as Voluntary Action Indicated (VAI). The USFDA had audited the plant between May 28 to June 6, 2024.
• Goa Carbon: Resumes work at the company’s Goa unit located at St. Jose de Areal, Salcete-Goa.
• Ramco Systems: Launches Aviation software 6.0 for smarter aircraft management.
• Inox India: Gets patent rights from Patents Office, Government of India for Cryogenic Liquid-based variable temperature cold storage unit and method.
• Lemon Tree Hotels: Signs license agreement for 108 rooms hotel in Mira Road. The property will be managed by its arm Carnation Hotels and is expected to open in financial year 2026.