MARKET BREADTH SIGNALS POSSIBLE STRENGTH NIFTY 25000 | BANK NIFTY 58000 | NIFTY IT 33000 IN FOCUS

Nifty tried to cope up with both initially bears were dominating & then bulls shown their presence last week but left everyone indecisive for the coming week ahead. Nifty & Bank Nifty both posted fall of 2.20% & 2.89% subsequently. Broader markets continue to make fool out of everyone with indecisive moves showing weakness where it seems like bottom formation is in progress but nobody is aware of it.

As we move ahead & enter into the third week of May 2026 series, we continue to expect a move towards 25000 in Nifty, followed by 58000 in Bank Nifty & one contender more has come, “Nifty IT” which may now have eyes with an immediate target of 30000-33000 within the May series itself. Well, as of now, it looks surprising & unimaginable targets, but it may look possible once a positive flow comes into the markets anytime.

So far, since the war between US-Iran-Israel begin it not only put Global Equities at risk but also other asset classes. But since this war is not likely to end very soon & speculations & exchange of comments are highly likely to remain intact, we expect its major repercussions may now gradually come to affect at least the Equity markets & a gradual up move may soon begin in the entire Indian Equity markets.

FII’s remained aggressive sellers across the board with massive sell off of almost Rs. 13,583.47 cr. last week, while DII’s remained net buyers with net buying of Rs. 18,524.53 cr. FII’s now once again turned the tables, where on 23^rd Jan.’26 was the highest at 2.28 Lacs, which eventually came down to as low as 1.03 lacs but closed the last week net shorts now at 2.17 lacs contracts it may now look like positive bias from FII’s is likely to come.

For broader markets to ascertain the possible positive momentum, a few key major factors are likely to be considered & are likely to top out soon. So, far we have so many mixed data developments across the board, which has been the reason for volatility in Equities across the globe. Rupee, crude oil, Dollar Index, etc. Let’s dig it out one by one: 

1. Rupee:  Rupee hit another All-time low of 96.144, creating panic across the sectors, especially banking & financials sectors, but a positive flow is expected towards a cooling zone of 93 in a few weeks’ time frame.
2. Dollar Index: This may hit 100-101 in the near term.
3. Brent Crude oil: Brent crude oil hit another All-time high of 120.52$ per barrel & cooled off towards 102.81$. In the coming months, we expect this to cool off towards 80-90$ somewhere as the UAE exited the OPEC & OPEC+.
4. FII’s Remained Seller: FII once again remained on the sell side & it doesn’t look like any kind of easing up as of now. Not a good sign. But net index shorts hit higher at 2.38 lacs, a possible cool off has begun & settled last week at 2.17 lacs.

Nifty last week has been volatile where initially it shown some pressure but a positive flow was there & a revival was seen in second half to give a decisive close at 23643.50. As we move ahead & enter into the third week of May 2026 series we continue to expect a move towards 25000 for gradual targets of 24600 / 24900-25300 kind of levels while on the downside 23000-23250 remains as an immediate crucial support levels. This time the support could come from Bank Nifty & IT Sector both.

Meanwhile Bank Nifty may now find its crucial support levels at 52700-53200 kind of levels & from those levels a meaningful upside can be seen towards 56700-57000 followed by 58000 kind of levels. The support may come from Private sector banks.

“Nifty IT” looks like has finally came near to support levels of 26000-27000 kind of levels to finally close this correction journey & from hereonwards we may get the possible buying towards 30000 / 33000 kind of levels very soon.

Brent crude oil hit another All-time high of 120.52$ per barrel & cooled off towards 102.81$. In the coming months we expect this to cool off towards 80-90$ somewhere as UAE exited the OPEC & OPEC+.

FII’s have been into net sell in 9 months out of 12 in current Fiscal year 2025-26 creating ruckus pressure on the entire markets. In the traders / investors community it has now become a basic question why they are selling? & When this selling would stop?

Why FII’s have been continuously selling in Indian Markets?

As the geopolitical issues continue to rise as US-Israel-Iran war leads a continuous decline in Rupee which hit all time low of 94.988 followed by inconsistent government policies into taxation in the capital markets & other things. Add on burden on the markets in respect to STT rate hike continuous pressure on FnO volumes reduction.

In recently launched GDP growth rate of India in Q2 has been 8.20%. At the same time, it is being projected that it will grow at 7.30% in the Fiscal year 2025-26 while USA has recently shown a GDP growth rate of 4.40% which is furthermore projected to grow at 4.70% so for a Developed economy which is showing nearly 5% of growth lately. In contrast, target country which is still a Developing country with a projected growth rate of 7.60% but its currency is declining on a fast scale why would any institutions go for a Emerging Markets when it can get a growth of nearly 5% in an already developed nation while saving currency devaluation risk. Isn’t it a safer investment for them?

Well, ofcourse yes this could have been a major reason for FII’s to relentlessly sell into the Indian Equity markets.

It has been more than 18 months now starting from October 2024 when Indian markets have consistently remained under pressure & each time some new news item comes to put the additional pressure on the domestic equity markets.

We clearly mentioned earlier that Nifty’s pressure only resembles the pressure of political will rather than fundamental one. FII’s selling has kept its pressure intact to the Indian domestic Equity markets as it went lesser last month the real realization came forward & now the Indian markets growth story rises & the politically backed selling with pressure from the Trump administration to diminish the Indian markets & create an artificial pressure to put an end to the Indo-Russia friendship remains untouched.

India remained on the higher ground on GDP data front where it achieved a milestone with historic growth rate of 7.80% in Q1, 8.20% in Q2 & 7.80% in Q3 of FY 25-26 completely mocking Trump’s “Dead Economy” jibe at its face where India remained on the Top-notch developing economy set for a target of $25 Trillion economy by 2047 on track. However, chairman of Reliance Industries Limited Mr. Mukesh Ambani said in its latest AGM last week that India has the capacity to achieve 10% GDP growth annually which once again has set another long-lasting futuristic goal for the entire economy.

FII & DII’s monthly data so far in the FY 2026-27 has been interesting where FII’s bought in few months initially then abstain from buying or remained to being on the sell side while DII’s remained the biggest supporter of the broader markets. The data below mentioned:

Brent crude oil hit another All-time high of 120.52$ per barrel & cooled off towards 102.81$. In the coming months we expect this to cool off towards 80-90$ somewhere as UAE exited the OPEC & OPEC+.

The Indian Equity markets have gained many recent news items where major of the news items are mentioned below:

• Rupee may now cool off towards 93.
• Dollar Index may remain hit 100-101.
• Brent crude oil hit another All-time high of 120.52$ per barrel & cooled off towards 102.81$. In the coming months we expect this to cool off towards 80-90$ somewhere as UAE exited the OPEC & OPEC+.

On the other side FII’s net longs now near to 10-11% & a recovery is possible towards 27% till the coming weekend which continuously signifies & now support could be within the range of 23000-23250 in Nifty.

In the wholesome broader markets witnessed some key events & their outcomes last week which are described as follows:

Domestic News:

1. Maharashtra government has cut VAT on Aviation Turbine Fuel (ATF) from 25% to 18%, giving airlines relief and potentially easing airfare pressure.
2. Govt cuts export duties on fuel: petrol ₹3/l, diesel ₹16.5/l, ATF ₹16/l; domestic excise unchanged.
3. Adani Group Investment: Global investors, including Temasek and Alpha Wave, are reportedly in talks to invest approximately $1.3 billion in the Adani Group’s airports business.
4. RBI Dividend: The Reserve Bank of India is expected to pay a record dividend to the government this year, providing a boost to the fiscal deficit management.
5. Energy Deals: Inox Clean Energy acquired US-based Boviet Solar’s assets for $750 million, marking a major expansion into the US renewables market.
6. Tech Sector Shifts: Oracle has reportedly pulled campus offers at some IITs and NITs following mass layoffs. The IT sector continues to face challenges due to AI disruptions.
7. Sugar Export Ban: The government has banned sugar exports until September 2026 to ensure domestic supply and stabilize local prices.
8. Delhi Austerity Measures: The Delhi government announced new measures to save fuel and reduce costs, including a work-from-home advisory for employees twice a week and a six-month ban on purchasing new petrol or diesel government vehicles.
9. Inflation Surge: India’s wholesale inflation (WPI) jumped to 8.3% in April, a 42-month high, while retail inflation hit a 13-month high of 3.48%.
10. India is evaluating major tax reductions on foreign investors’ bond purchases to match global standards and boost capital inflows. Currently, interest income faces ~20% tax while capital gains vary by treaty—higher than peers—limiting foreign ownership to 3% of the ₹13T market. RBI proposed this amid rupee pressure (down 6% in 2026), with Finance Ministry actively reviewing to curb outflows and lower yields
11. Jewellery Boom: Jewellery brands are rapidly expanding, now occupying nearly 10% of total mall space in India, up from just 1% four years ago.
12. Milk Price Hike: Amul and Mother Dairy increased milk prices by ₹2 per litre across India effective today, citing rising input and procurement costs.
13. Coal Gasification Package: The Cabinet has approved a ₹37,500 crore package to boost coal gasification initiatives in India.
14. Automotive Shifts: India has doubled the platinum import duty, a move expected to raise costs for diesel SUVs and hybrids. Meanwhile, Maruti Suzuki reached a milestone by dispatching 30 lakh cars via railways.
15. Aviation Update: The Airports Economic Regulatory Authority (AERA) has fixed the User Development Fee (UDF) for domestic passengers at ₹490 for certain greenfield projects, while deferring some revenue recovery to moderate charges at Noida airport.

International news:

1. US auto loan delinquencies hit a 32-year high as borrowers struggle with record monthly payments.

2. Trump-Xi Summit Concludes: US President Donald Trump and Chinese President Xi Jinping have wrapped up a high-stakes summit in Beijing. Trump reported “fantastic trade deals” were made, though Xi warned of potential “clashes and conflicts” regarding the status of Taiwan.

3. UAE to invest $5 billion in Indian infrastructure, RBL Bank, and Samman Capital.

4. Russia and India discussed joint weapons production and space cooperation, says Russian Foreign Minister Lavrov.

5. The US rejected Iran’s 14-point proposal to end the war, calling it “not acceptable,” and maintains a hardline stance demanding Iran completely abandon its nuclear program.

6. Trump said the U.S. wants Iran to open the Strait of Hormuz, feels very close to ending the war, and that a lot of good things are happening

7. US business schools are slashing MBA tuition by up to 50% as applications drop amid a weak job market, rising debt, and AI fears over white-collar jobs.

8. US Senator Marco Rubio stated that China and the US have agreed the Strait of Hormuz should not be militarized, per NBC News. This comes amid rising tensions in key global shipping lanes.

9. Iran Accuses UAE of Direct Role in Attacks

10. White House says President Trump and Xi agreed the Strait of Hormuz must stay open for global trade, rejecting Iranian control

11. BRICS Meeting in India: India is hosting a two-day BRICS foreign ministers’ gathering in New Delhi, focusing on bridging rifts regarding the West Asia conflict.

12. Ukraine-Russia War: Russia launched a massive drone and missile attack on Kyiv, resulting in at least five deaths. Ukrainian officials have linked the timing of the strike to the summit in Beijing.

13. Federal Reserve Leadership: The U.S. Senate confirmed Kevin Warsh as the new Federal Reserve Chair, taking over from Jerome Powell.

14. Nvidia CEO Joins Delegation: Jensen Huang joined Trump’s visit to China as a last-minute addition, signaling AI and chip supply chains as central themes of the talks.

Nifty last week has been volatile where initially it shown some pressure but a positive flow was there & a revival was seen in second half to give a decisive close at 23643.50. As we move ahead & enter into the third week of May 2026 series we continue to expect a move towards 25000 for gradual targets of 24600 / 24900-25300 kind of levels while on the downside 23000-23250 remains as an immediate crucial support levels. This time the support could come from Bank Nifty & IT Sector both.

Meanwhile Bank Nifty may now find its crucial support levels at 52700-53200 kind of levels & from those levels a meaningful upside can be seen towards 56700-57000 followed by 58000 kind of levels. The support may come from Private sector banks.

“Nifty IT” looks like has finally came near to support levels of 26000-27000 kind of levels to finally close this correction journey & from hereonwards we may get the possible buying towards 30000 / 33000 kind of levels very soon.

Sensex may now find its crucial support at 73000-74000 kind of levels while on the upside we may see a pull back towards 81000-82000 kind of levels.

Nifty Financials may find its crucial support levels now at lower levels of 24000-24500 kind of levels upside immediate target lies at 27000 kind of levels.

As of January 2026 the number of Demat Accounts has hit whopping 21.6 crores this not only helps the capital markets directly but also directly to Equity investments.

The monthly SIP in Indian markets have now increased to All Time High of Rs. 32,087 cr. per month as on March 2026.

Brief Levels of Nifty / Sensex/ Bank Nifty / Nifty Financials / Nifty IT:

Nifty CMP:  23643.50
Nifty Potential Upside: 24600 / 24900-25300 (As the case may be)
Nifty Immediate Crucial Support: 23000-23250

Sensex CMP: 75237.99
Sensex Potential Upside: 81000-82000
Sensex Immediate Crucial Support: 73000-74000

Bank Nifty CMP:  53710.35
Bank Nifty Immediate Upside: 56700-57000 / 58000
Bank Nifty Immediate Crucial Support: 52700-53200

Nifty Financial CMP: 25343.85
Nifty Financial Immediate Target: 27000
Nifty Financial Immediate Crucial Support: 24000-24500

Nifty IT CMP: 27360.35
Nifty IT Immediate Target: 30000 / 33000
Nifty IT Immediate Crucial Support: 26000-27000

Stock on Radar:
Large Caps:

• TCS (CMP 2264):As the IT sector & its giant came near to their respective long term support levels we expect a strong move towards 2800 within 3 months’ time frame from CMP 2264 with SL placed at 1900.

• Havells (CMP 1209):This large-cap counter looks like is under over sold position with summer heating up this counter looks good to add here at CMP 1209 with strict SL placed at 1100 one can expect a upside towards 1400 in no time.

•  HDFC Bank (CMP 767): This large-cap private sector bank has shown positive divergence with DOJI on the bottom on Weekly charts & looks good to add here at CMP 767 with strict SL placed at 720 one can expect an upside towards 850 in no time

 About the Author:

Mr. Vishal Gupta a SEBI Registered Research Analyst is the founder of “VG STOCK RESEARCH”, founder of “THE ANALYSIS ROOM”, a writer & an advisor having rich experience in Indian Equity Markets who has spent years comprehending an industry wide shift and risk management with more than 14+ years exploring in depth analysis of the Equity & Derivatives.

He has also been into teaching Fundamental Analysis for quite some time giving investors/traders comprehensive knowledge & skills of Indian Equity Markets.

Email I’d: contact@vgstockresearch.com
Contact: +91-9953934544
Website: https://vgstockresearch.com/
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