NIFTY Index Chart Analysis

March turned out to be a marvellous month for the Nifty 50 index, which gained 6.30 per cent—its best monthly performance in eight months. This rally was supported by foreign institutional investors (FIIs) turning net buyers after five consecutive months of selling. FIIs purchased equities worth ₹2,014.18 crore during March. Meanwhile, domestic institutional investors (DIIs) continued their buying spree, recording net purchases to the tune of ₹37,585.68 crore.[EasyDNNnews:PaidContentStart]

However, after a strong March, the new financial year has begun on a weak note. Despite a truncated trading week, market activity remains eventful, largely driven by developments surrounding global trade tariffs. This was evident in Tuesday’s 8 per cent spike in India VIX, along with the Nifty 50 posting its steepest singleday fall in over a month.

Following this correction, the Nifty 50 has declined nearly 3 per cent from its recent swing high, retracing approximately 38.2 per cent of the upmove from the low of 21,964.60 to the high of 23,869.60. Nevertheless, the index continues to trade above its 20-daymoving average and maintains a rising trajectory.

We anticipate volatility to persist,primarily due to uncertainty linked to tariff-related developments. The next key support zone lies around 22,860– 22,917—a confluence of the 20-day moving average and the 50 per cent Fibonacci retracement level. Should this zone fail to hold, the correction could extend towards 22,690, which marks the 61.8 per cent retracement level. We believe this zone presents a favourable risk-reward entry opportunity.

From a harmonic trading perspective, the ongoing corrective phase appears to be forming the “C” leg of the AB=CD pattern, a well-known structure in technical analysis. The AB=CD pattern comprises: AB : The initial impulsive move upward BC : A corrective pullback CD : A move equal in length to AB In this context, the 22,690–22,900 range could complete the “C” leg, with a potential reversal and rally forming the “D” leg. If the market finds support within this zone and begins to move higher, it would validate the AB=CD formation and suggest a continued upward trend.

Should the current corrective leg hold above the 22,690–22,900 zone, a higher low formation is likely. Once this higher low is established, the index may encounter resistance around the 23,600–23,650 levels. A decisive move above this resistance zone could open the path for further upside towards 23,800–23,900. However, we anticipate some consolidation around this stiff resistance level, which may only be breached through a strong gap-up opening. If this scenario plays out, the upside target by the end of April 2025 could be in the 24,300–24,500 range.

Seasonality analysis supports this thesis. Historically, the Nifty 50 has delivered an average gain of 2.10 per cent in April. Since 2016, the index has closed in negative territory during April on only two occasions—in 2021 and 2022.

In the near term, the implementation of reciprocal tariffs by former US President Donald Trump, along with the upcoming RBI policy meeting, are expected to inject bouts of volatility into the market. Hence, it would be prudent for investors to adopt strict risk management practices. Once these events are out of the way, focus will shift to the earnings season, which is likely to dictate the market’s trend going forward.

STOCK RECOMMENDATIONS

AMI ORGANICS LTD .............................. BUY ......................... CMP ₹2525.90
BSE Code : 543349
Target 1 .... ₹2,770 
Target 2 ..... ₹2,840 
Stoploss....₹2,350 (CLS)

Ami Organics Ltd (AOL) is engaged in manufacturing advanced pharmaceutical intermediates and speciality chemicals. Under its pharmaceutical intermediates segment, it manufactures molecules that are under clinical trial, or which have been launched in the patented and generic market. It also manufactures speciality chemicals with end-usage in cosmetics, food and personal care, dye and polymer industries, among others.

Technically, the stock price of AOL is trading near its pivot point and near its all-time high. As the stock is trading close to its all-time high, it is above all the short and long-term moving averages. All the moving averages are trending up. At the same time, there is a desired sequence. The stock is meeting most of the CANSLIM characteristics. The stock has an EPS Rank of 86 which is a good score indicating consistency in earnings, a RS Rating of 94 which is great indicating the outperformance compared to other stocks, Buyer Demand at A which is evident from recent demand for the stock, Group Rank of 56 indicates it belongs to a fair industry group of Chemicals-Specialty and a Master Score of A is the best. Overall, the stock has great fundamentals and technical strength to stay in momentum. Considering the above factors, we recommend buying this stock in the range of 2,510-2,540 for a target of ₹2,770-2,840 with a stop loss of ₹2,350 on a closing basis.

GALLANTT ISPAT LTD ........................... BUY .......................... CMP ₹408.10
BSE Code : 532726
Target 1 ...... ₹460 
Target 2 ..... ₹484 
Stoploss.....₹368 (CLS)

Gallantt Ispat Ltd., incorporated in 2005 by first-generation entrepreneur Mr. Chandra Prakash Agrawal, is a leading integrated steel manufacturer in India, committed to producing a diverse range of high-quality iron and steel products which includes Sponge Iron, Billets and TMT Bars. Since our inception, we have focused on sustainable growth and innovation, utilising modern technology and a robust infrastructure to meet the ever-growing demand in sectors such as infrastructure, construction, and manufacturing.

Technically, the stock has witnessed a breakout of a 6-month long consolidation pattern and it is trading at a fresh all-time high. The breakout above the consolidation pattern is supported by a strong volume of more than five times the 30-day average volume of 0.84 lakh shares per day highlighting larger participation in the direction of the trend. The daily 14 periods RSI is in an uptrend and is seen rebounding, taking support at its nine periods average thus validates positive bias and it has seen a range shift to super bullish territory. Interestingly, the stock meets the majority of the CANSLIM criteria. The stock has an RS Rating of 88 which is good indicating the outperformance compared to other stocks, Buyer Demand at A- which is evident from recent demand for the stock, Group Rank of 38 indicates it belongs to a strong industry group of Steel-Producers and a Master Score of B is close to being the best. Considering the above thesis, we recommend buying this stock with a stop loss of ₹368 with a target of ₹460-484.

*LEGEND:  ◼ EMA - Exponential Moving Average.  ◼ MACD - Moving Average Convergence Divergence  ◼ RMI - Relative Momentum Index  ◼  ROC - Rate of Change  ◼ RSI - Relative Strength Index (Closing price as of April 01, 2025)

Disclaimer : Above recommendations are based on various technical parameters and any fundamental input has not been considered for the recommendations. Follow strict stop loss for the recommendation.

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