Trade Setup for March 26: Nifty remains in Buy-on-Dips mode despite resistance at higher levels

The Nifty 50 encountered resistance at its previous swing high on Tuesday, leading to market volatility before ending slightly lower. Analysts had anticipated a pullback following the sharp rebound over the past 5-6 sessions.

Market Overview

The market opened positively, sustaining momentum in the early session.

However, it struggled to hold above the key 23,800 level and weakened in the latter part of the day.

Despite a sharp drop of over 250 points from the day’s high, the index closed in the green at 23,669.

Nifty and Sensex extended their winning streak to seven sessions, though midcap and smallcap indices faced profit booking, declining by 1% and 1.6%, respectively.

Key Movers

Top Losers: IndusInd Bank, Dr. Reddy’s, Adani Enterprises.

Top Gainers: UltraTech, Trent, Bajaj Finserv.

Global Market Influence

Investors remain uncertain over US reciprocal tariffs. While there are expectations that President Donald Trump may roll back some proposed tariffs on India, concerns persist over possible secondary tariffs of 25% on countries like India and China for importing oil from Venezuela.

Institutional Activity

Foreign investors remained net buyers in the cash market.

Domestic institutional investors were net sellers.

Expert Analysis

Nagaraj Shetti, HDFC Securities: The market is in a consolidation phase, but the uptrend remains intact. Support is seen at 23,400, and any dip could present a buying opportunity. A move above 23,900 could push Nifty toward 24,200.

Rupak De, LKP Securities: Nifty is expected to consolidate between 23,300 and 23,800. Immediate support is at 23,600, and a decisive break below could push it towards 23,300. Resistance remains at 23,800, with a breakout possibly resuming the rally.

Ajit Mishra, Religare Broking: Traders should maintain a buy-on-dips approach, focusing on the banking and financial sector.

Devarsh Vakil, HDFC Securities: After a 1,900-point recovery from the recent swing low of 21,964, Nifty appears to be consolidating. Key support is at 23,400, with short-term resistance at 23,869 and further resistance at 24,125.

Stocks to Watch

Manappuram Finance: To consider a borrowing program for FY26 on March 29.

BHEL: Extended technology collaboration with Vogt Power International Inc., USA, for Heat Recovery Steam Generators.

IREDA: Approved a borrowing program of up to ₹30,800 crore for FY 2025-26.

Federal Bank: Acquiring a 4% stake in Ageas Federal Life Insurance for ₹97.44 crore.

Infosys: Incorporates a new step-down subsidiary, Infosys BPM Netherlands BV.

IRFC: Signs a ₹5,000 crore loan agreement with NTPC Renewable Energy.

NTPC Green Energy: Commissions 100 MW capacity of the 320 MW Bhainsara Solar PV project.

NCC: Secures two orders worth ₹10,804.6 crore from BSNL.

Waaree Energies: To inaugurate a 5.4 GW solar cell manufacturing plant in Gujarat on March 29.

Indegene: Subsidiary Indegene Ireland to acquire MJL Communications Group & MJL Advertising for GBP 3.4 million.

Arvind SmartSpaces: Sells 200 plots worth ₹180 crore in Bengaluru at its ‘Arvind The Park’ project.

With Nifty showing signs of consolidation, market participants are advised to keep a close watch on key levels and remain selective in their stock picks.