Nifty Shows Resilience as Broader Market Participation Increases, Says HDFC Securities Analyst

Indian equity markets are showing resilience that goes well beyond the headline index, according to Vinay Rajani, AVP and Senior Technical and Derivative Analyst at HDFC Securities. In an interview with ET Now, Rajani laid out a constructive near-term view on Nifty, a more cautious stance on Bank Nifty, and two specific stock picks for traders looking to deploy fresh capital.

Nifty: A healthy correction, now resuming higher

The Nifty's recent trajectory has been textbook technical behaviour. From a swing low of 22,200, the index rallied 2,400 points before hitting resistance and pulling back around 800 points — a retracement of almost exactly 33% of the prior rally. That 33% Fibonacci support level coincided with the 23,800 mark, where the index found buyers and resumed its upward move.

Rajani sees the next meaningful resistance at 24,600, a prior swing high, followed by the 200-day exponential moving average — also placed near that zone. His advice to traders already holding long positions: stay in, with a stop loss at 23,800, the most recent swing low.

Notably, Rajani pointed out that the broader market has been significantly stronger than the headline index suggests. The microcap 250 index has risen 23% from its recent swing low, while the smallcap index is up 21%. Midcap participation has also been robust. "Broader market participation has been exceptional," he said — a sign that the rally has depth, not just index-level momentum.

Bank Nifty: Bounce, but not a buy

Bank Nifty staged a recovery on the day of the interview after underperforming the previous session, but Rajani was measured in his enthusiasm. The overall structure of Bank Nifty, he said, is not as positive as Nifty. A key reason: IT stocks have begun participating meaningfully in the current rally, lending Nifty broader support that Bank Nifty does not enjoy. His call is clear — on a sustainable basis, Nifty is likely to outperform Bank Nifty, and he expressed more conviction in the former.

Stock Pick 1: Oil India, a resilient stock now turning offensive

Oil India was Rajani's first pick, and the logic is straightforward. The stock held up well during the broader market decline, demonstrating relative strength. More importantly, it has now begun moving higher on rising volumes — a technical confirmation that buying interest is returning.

Entry level: Rs 500–501. Stop loss: Rs 490. Target: Rs 525.

Stock Pick 2: Reliance Industries, a textbook reversal signal

Reliance Industries is Rajani's second pick and carries a stronger positional case. After a prolonged period of underperformance, Reliance has reclaimed its 50-day EMA. On the monthly chart, Rajani identifies a bullish hammer candlestick pattern — a classic reversal signal — which he describes as a textbook setup for both short-term traders and positional investors.

Entry level: Rs 1,420. Stop loss: Rs 1,380. Target: Rs 1,465.

The macro backdrop

What makes Rajani's bullish tilt notable is the context. Crude oil remains elevated, a headwind that would ordinarily weigh on sentiment. Yet market breadth is holding, participation is widening, and key technical levels are being defended. For now, the charts are speaking louder than the macro noise.