Index Outlook: Ready To Rise & Shine

Two major events jolted the Indian stock markets last week. First was the increase in Securities Transaction Tax in Futures and Options announced in the Union Budget. This triggered a strong sell-off on February 1 when Budget was presented. Then, the US announcing the reduction of the tariff on India made the market see a huge gap-up open on Tuesday. However, there was no follow-through rise and the indices fell all through the rest of the week.

On the charts the picture looks positive. There is no danger of a major fall, and supports are there to limit the downside. We expect the Indian benchmark indices to rise to new highs in the coming weeks.

FPIs buy

Foreign Portfolio Investors (FPIs) snapped their six-week selling spree. They turned net buyers last week. The Indian equity segment saw a net inflow of about $897 million. If the FPIs accelerate their purchase, then, that would aid the Sensex and Nifty to go higher.

Nifty 50 (25,693.70)

Short-term view: Immediate support is in the 25,500-25,450 region which has held well last week. A rise from here can take the Nifty up to 26,300-26,400 again in the short term. This 26,400 is a very crucial resistance. Nifty has to breach this hurdle in order to go further higher towards 26,800 or so.

In case the index breaks below 25,450 from here, then a fall to 25,100-25,000 can happen first. Thereafter the index can bounce back again and go up to 26,000 and higher.

Medium-term view: The broader bullish view remains intact. Nifty can rise to 27,500-28,000 in the medium term. A decisive break above 26,400 can clear the way for this rise. Eventually we can see the Nifty touching 30,000-31,000 in the long term.

Strong support will be in the 24,000-23,500 zone. The rise to 28,000 and higher will get negated only if Nifty breaks below 23,500. Such a break, though less likely now, can drag it down to 22,000 and lower.

Nifty Bank (60,120.55)

Short-term view: Support is in the 59,500-59,400 region which can be tested earlier this week. A bounce from this support zone can take the Nifty Bank index higher towards 60,800-60,850. This leg of rise will have the potential to breach 60,850 and take the index higher to 62,000-62,100 eventually.

Failure to bounce back from the 59,500-59,400 support zone can drag the index lower to 58,800 or 58,400, but not beyond that. Nifty Bank index can reverse higher from either of these two levels and go back up to 60,000 and higher again. In this case, the rise to 62,000 will get slightly delayed.

Medium-term view: The consolidation within the broad uptrend is still in place. The bias continues to remain bullish for the Nifty Bank index to see 63,000-63,500 in the medium term. From a big picture, the index can target 68,000-69,000 in the long term.

Strong support is in the 54,000-53,800 region. Only a fall below 53,800 will negate the bullish view and turn the outlook negative.

Sensex (83,580.40)

Short-term view: Supports are at 82,800 and 82,500. Sensex can sustain above these supports and rise back to 84,400 initially and then to 85,800-86,000. Ideally Sensex must breach 86,000 in order to gain momentum and rise further.

If Sensex breaks below 82,500 this week, then a fall to 81,200 can happen first and then it can rise back again.

Medium-term view: The overall bullish outlook will remain intact as long as the index remains above 79,500. We keep intact our view of the Sensex rising to 89,000-90,000 in the medium term and 98,000-99,000 in the long term.

A fall below 79,500 is needed to negate this bullish view. But that looks less likely as of now.

Nifty Midcap 150 (21,926.85)

The support at 20,800 had held very well even during the strong fall witnessed on the Budget Day. That indicates the strength of the support and also the presence of fresh buyers below 21,000.

For now, 21,630 and 21,550 are key supports for the week. Resistance is around 22,200. A break above it can take the index up to 22,800 this week. An eventual break above 22,800 will then strengthen the bullish momentum. That in turn can take the Nifty Midcap 150 index up to 26,000-26,500 in the medium term and 28,000-28,500 in the long term.

The index has to break 20,800 decisively to go down towards 20,000. Also, a fall below 20,000 is needed to increase the selling pressure. Only then the danger of seeing 18,000 on the downside will come into the picture.

Nifty Smallcap 250 (15,864.50)

The index is managing to hold well above 15,000. Near-term support is at 15,650. While that holds, the resistance at 16,300 can be tested this week. A break above 16,300 can trigger an extended rise to 16,700-16,800. A strong rise above 16,800 is needed to see some relief, and then take the index higher to 18,000 levels.

Looking at the long-term charts, the region around 15,000 is a strong support which is holding very well now. So, a rise to 18,000 from here will indicate the beginning of a fresh leg of upmove. That will have the potential to take the Nifty Smallcap 250 index up to 22,500-23,000 in the long term.

So, this could be a good time to enter the small-cap segment. A strong fall below 15,000 is needed to negate this bullish view.

Published on February 7, 2026