Trade Setup for April 29: Immediate outlook for the Nifty remains positive

Nifty 50's move above 24,400 is expected to erase recent short-term bearish patterns and could trigger a sharp rally toward the next resistance levels around 24,600–24,800, analysts say.

After two sessions of corrective action, the Nifty 50 resumed its upward momentum, reclaiming the 24,300 level. It opened 30 points higher at 24,070 and extended its gains towards 24,355, falling just 10 points short of Friday’s high. The index erased most of Friday’s losses, closing 289 points higher at 24,329.

Sector Performance and Market Highlights

Top Gainers:

Jayaswal Neco Industries: ₹42.37 (+19.99%)

Premier Explosives: ₹438.50 (+13.29%)

Oriental Trimex: ₹10.30 (+12.81%)

Barbeque Nation Hospitality: ₹306.65 (+10.41%)

RBL Bank: ₹207.10 (+10.11%)

The broader market bounced back strongly after a brief phase of profit-booking, with the Nifty Midcap 100 index leading the charge with a 1.62% gain, followed by the Nifty Smallcap index, which advanced by 0.78%.

Reliance Industries Powers Nifty Surge

Reliance Industries Ltd. (RIL), a heavyweight on the Nifty 50, contributed nearly 40% of the index's gains. RIL's shares surged by over 5% on April 28, responding positively to their March quarter results. This was the biggest single-day gain for RIL since June of the previous year.

Despite a weak Q4 performance from Shriram Finance, which saw a significant Gross NPA write-off, RIL’s strong performance helped boost market sentiment. Other sectors like Oil & Gas, PSU Banks, Pharma, and Healthcare saw solid gains as well, with the Oil and Gas index being the top performer, rising by 3%.

Defence Stocks Surge Amid Tensions

Shares of India’s defense companies, including Garden Reach Shipbuilders, Data Patterns, Cochin Shipyard, Mazagon Dock Shipbuilders, and Hindustan Aeronautics, surged between 5% and 8%. This was driven by ongoing tensions at the Line of Control (LoC) between India and Pakistan, following the Pahalgam Terror Attack and incidents of ceasefire violations over the weekend.

What’s Ahead for the Market?

Analysts are now eyeing upcoming earnings reports from key companies like Bajaj Finance, Bajaj Finserv, Trent, BPCL, and Ambuja Cements. The focus will also be on global cues, especially as the US and China have softened their stance on tariffs and agreed to begin discussions.

Additionally, the market is benefiting from consistent Foreign Institutional Investor (FII) inflows, which have reached ₹32,467 crore over the last eight trading sessions, helping to lift investor sentiment.

Nifty 50 Technical Outlook

The Nifty 50 has regained momentum, shrugging off the recent bearish pattern. According to Nagaraj Shetti of HDFC Securities, the immediate outlook for the Nifty remains positive. A move above the 24,400 mark will negate the recent short-term bearish pattern and could lead to a sharp rise toward the next resistance levels of 24,600-24,800. Immediate support is seen at 24,050.

On the upside, the Nifty is facing resistance at 24,360, and a breakout above this level could propel the index towards 24,550, which coincides with the 61.80% Fibonacci retracement of the previous fall from 26,277 to 21,743. However, if the Nifty falls below 24,000, it could see a decline towards 23,800 or even 23,350.

Nifty Bank Technical Outlook

The Nifty Bank index continues to show strength, trading within a consolidation phase, but with a positive structure above its breakout neckline. Dhupesh Dhameja of SAMCO Securities notes that the index remains in a tug-of-war between buyers and sellers. The key support zone is between 54,000 and 54,300, and as long as the index holds above this level, the broader outlook remains positive.

A breakout above 56,000 could reignite bullish momentum, with the next target at 56,500.

The Nifty 50’s recovery is a promising sign, and the index is set to test higher resistance levels, with reliance on stocks like RIL to drive the momentum. Traders will be closely watching for any developments in earnings reports and geopolitical tensions, while technical levels suggest a cautiously optimistic outlook for the near term.