Trade Setup July 4: A decisive breakout past 25,580 could revive upward momentum
Despite the weakness in benchmark indices, broader markets displayed resilience, with the Nifty Midcap 100 inching up 0.03% and the Smallcap 100 gaining 0.26%. Sectoral trends were mixed, with Media, Consumer Durables, and Healthcare leading the gains, while PSU Bank, Metal, and Realty indices dragged.
In standout performances, Dr. Reddy's Laboratories, Apollo Hospitals, and Hero MotoCorp managed solid gains. On the flip side, SBI Life, Kotak Bank, and Bajaj Finserv emerged as session laggards. Vedanta fell over 2% after reports surfaced that its demerger hit a potential snag at the NCLT.
HDB Financial Services, recently listed on the bourses, extended its listing gains by rising another 6%, adding to its 13.5% debut surge. Meanwhile, foreign institutional investors turned net sellers in the cash market, while domestic investors were net buyers.
Market sentiment remained cautious amid global uncertainty, especially with key US economic indicators—including jobless claims, payroll data, and services PMI—slated for release later in the day. Additionally, developments on US-India trade talks are being closely monitored.
Siddharth Khemka of Motilal Oswal noted that markets may stay range-bound as investors adopt a wait-and-watch strategy. Nandish Shah of HDFC Securities observed that the Nifty is in a short-term corrective phase, with support at 25,317 and 25,222, while 25,600 remains a key hurdle.
According to Rupak De of LKP Securities, the formation of an inside bar on the daily chart indicates indecision among traders. He emphasized that as long as the index holds within the 25,300–25,500 zone, sideways movement is likely to continue.
Om Mehra of SAMCO Securities added that a sustained close above 25,260 would keep the bullish structure intact. A decisive breakout past 25,580 could revive upward momentum, with the next resistance targets at 25,740 and 25,850.
The Nifty Bank index also ended lower at 56,791.95, down 0.36%. Mehra said the support zone lies between 56,300–56,400, and that any consolidation above 56,000 may set the stage for renewed upside. A break above 57,200 could signal strength and potential for fresh highs.
Investors are advised to watch key levels closely and use the ongoing consolidation phase as a strategic opportunity for re-entry.
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