Week Ahead

During the week ended February 16, the BSE Sensex rallied 1.16 percent to 72,427, and the Nifty 50 jumped 1.19 percent to 22,041, while the broader markets underperformed benchmark indices as the Nifty Midcap 100 index gained half a percent and Smallcap 100 index fell half a percent.

The positive momentum is expected to continue in the coming week, too, along with intermittent consolidation and correction, with a focus on key takeaways from minutes of FOMC and MPC policies, US bond yields action, and global cues.

Globally the market participants will look for cues from the FOMC minutes of the January policy meeting, scheduled on February 22 as there have been mixed opinions from economists about the beginning of the Fed funds rate cut trajectory. Some are expecting the rate cut towards the end of the first half of CY24, while others are seeing the same in the second half of 2024, as they keep assessing the direction of the US economy and inflation data.

The RBI policy meeting minutes, which are scheduled on February 22, will also be closely tracked by the market participants to get any cue about the timing of a change in policy stance to neutral from accommodative currently.

Technically, the Nifty 50 looks strong as the index sustained an uptrend for the last four days and closed above its psychological 22,000 mark for the first time on a weekly basis, with healthy volumes. Hence, experts feel the record high of 22,126 is expected to be key for further upward trajectory, with immediate support at 21,950 and crucial at 21,500 area.

Options data indicated that the 22,000 is expected to be crucial for further direction in the Nifty 50 in the coming week, with immediate resistance at 22,100 and then 22,300, while the support lies at 21,900.