Nifty, Sensex, Nifty Bank outlook for today: GIFT Nifty up 45 points; key levels to watch

Indian equity benchmark indices are set to extend gains at the open on Tuesday after rising about 3 per cent in the last two sessions, boosted by a preliminary peace deal between Iran and the US, which triggered a sharp drop in crude prices. The peace agreement is a major step towards regional stability and reducing concerns over energy supply disruptions.

Indian equities extended their gains on Monday as improving global risk sentiment and a sharp correction in crude oil prices boosted investor confidence, said Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services. "Investors will track the formal signing of the US-Iran agreement, crude oil price trends, FII flow dynamics and evolving inflation expectations for direction."

GIFT Nifty, Asian markets & US stocks GIFT Nifty Futures on the NSE International Exchange were 46.40 points, or 0.19 per cent, up at 23,963, hinting at a positive start for the domestic market on Tuesday. Asian stocks retreated on Tuesday as investors turned their focus to monetary policy decisions ‌after a rally in the previous session on news of a US-Iran peace deal. Hang Seng was down a per cent, Nikkei and KOSPI turned flat.

Wall Street rallied on Monday, after the US and Iran struck a preliminary agreement to end the Middle East war and reopen the Strait of Hormuz. The Dow Jones Industrial Average rose 468.77 points, or 0.92 per cent, to 51,671.03, the S&P 500 gained 122.83 points, or 1.65 per cent, to 7,554.29. The Nasdaq Composite surged 795.10 points, or 3.07 per cent, to 26,683.94.

Crude, US dollar, gold & more Oil prices, which settled at a three-month low overnight, reflected the cautious stance, with Brent crude futures up 0.1 per cent at $83.25 a barrel. The US dollar index held steady ⁠at 99.69, firmly within the tight trading channel. Gold inched 0.1 per cent higher to $4,311.12 an ounce. In cryptocurrency markets, bitcoin was down 0.3 per cent at $66,281.99.

The rally was primarily driven by optimism surrounding a preliminary peace agreement between the US and Iran, which significantly eased concerns over potential disruptions to global energy supplies, said Ajit Mishra, SVP of Research at Religare Broking. "We continue to advocate a stock-specific approach with disciplined risk management and select domestic cyclical themes for long positions."

FII-DII flows Provisional data available with NSE suggest that FPIs turned net buyers of domestic stocks to the tune of Rs 200.05 crore on Monday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 3,189.26 crore on a net-net basis.

Nifty50, Sensex & India VIX outlook Technically, the market witnessed intraday profit booking at higher levels. However, the short-term outlook of the market remains positive. The 50-day SMA at 23,750 and 23,550, For Sensex 76000 and 75700 would act as crucial support zones for the market, said  Shrikant Chouhan, Head of Equity Research at Kotak Securities

"As long as the market is trading above these levels, the bullish trend is likely to continue. On the higher side, 24,000/76,800 and 24,100/77,000 remain key resistance levels for the bulls. However, if the market falls below 23,550/75,700, sentiment could change. Below this level, traders may prefer to exit their long positions," he adds.

Nifty managed to hold above the crucial 23,800 by the close and the near-term sentiment is likely to remain positive, with the potential for further upside as long as the index sustains above 23,800, said Rupak De, Senior Technical Analyst at LKP Securities.  "The Nifty may move towards 24,000–24,200 in the coming sessions. A breach below 23,800 could trigger a phase of near-term consolidation."

Sensex index formed a small bearish candle after a sharp gap-up opening, indicating profit booking and consolidation near the higher levels, said  Hitesh Tailor, Technical Research Analyst at Choice Equity Broking. "It managed to hold firmly above the broken falling trendline resistance and reclaimed its 20-Day EMA, reflecting improving market structure."

India VIX declined 3 per cent to close near the 14 level, and any further moderation in volatility is likely to strengthen the positive market sentiment, said Nilesh Jain, VP- Head of Technical and Derivative research at Centrum Finverse.

Nifty Bank outlook Nifty Bank failed to sustain at higher levels and witnessed profit booking. It continues to trade comfortably above all its key moving averages, highlighting the strength of the prevailing uptrend. The daily RSI is placed above the 60 mark and remains in a rising trajectory, indicating sustained positive momentum, said Sudeep Shah, Head of Technical & Derivatives Research at SBI Securities.

"Going ahead, the zone of 57,700-57,800 is likely to act as an immediate hurdle. A decisive move above 57,800 could trigger a fresh round of buying, paving the way for an upside rally towards the 58500 level in the short term. On the downside, the zone of 56,800-56,700 remains a crucial support area, and holding above this range will be essential to maintain the positive bias," he said.

Nifty Bank formed a bearish candlestick pattern with a higher high and a lower low and a bullish gap below its base signaling positive bias. It witnessed mild profit booking and has seen a strong rally of 4,800 points in the last 10 sessions, hence some consolidation cannot be ruled out in the coming sessions, said Bajaj Broking Research.

"We expect it to maintain overall positive bias and head towards 58,300 in the coming sessions being the measuring implication of the last four-week range breakout. Nifty Bank sustaining above 55,500, will keep the overall bias positive and any dips should be viewed as buying opportunities. A decisive breach below the 55,500 support level would negate the positive outlook," it adds.