Market Outlook: US-Iran Tensions Weigh on Indices, Nifty Faces Key Technical Resistance

Market Outlook

Indian Equities Face Gap-Down Bias

If crude prices sustain above $80-85 and global markets remain weak, Indian equities may open with a gap-down bias, potentially in the range of 1-2%. Immediate support lies at 24,950-24,900, with a sustained breach potentially dragging the index toward 24,600.

Technical Analysis

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Long-term moving averages have flattened, and oscillators have turned neutral, signaling a pause in momentum. However, Friday's breakdown below the 200-day EMA tilts the bias slightly cautious. On the upside, 25,450-25,500 remains a crucial resistance zone.

Recommendation

A bear spread strategy by buying 25,150 Put and selling 25,000 Put is recommended, as Nifty is likely to retest the 25,000-24,950 zone in the near term.

FII Positioning

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FIIs ended February as net sellers to the tune of Rs 6,641 crore, extending their selling streak every month since July 2025. This persistent outflow has been one of the key reasons behind the market's continued underperformance versus global peers.

Bank Nifty Outlook

Bank Nifty has outperformed broader indices in recent weeks, signaling relative strength in financials. However, momentum cooled last week, and the index traded in a tight range for four sessions, reflecting market indecision. Immediate support lies at the 50-day EMA around 60,000-59,900.

Stock Recommendation

Chennai Petroleum Corporation and Petronet LNG are recommended buys this week. Chennai Petroleum has given a decisive breakout backed by strong volumes, signaling renewed buying interest, while Petronet LNG MACD is in positive territory with a rising histogram, indicating strengthening momentum.