Indian equity markets demonstrated remarkable resilience on Monday, staging a strong recovery from early losses to close in positive territory. The Nifty 50 ended at 25,790.25, gaining 0.42%, while the Sensex closed at 83,878.17, up 0.36%. The turnaround was attributed to positive developments in India-US trade relations and record-breaking performance in precious metals.

India-US Trade Relations Boost Market Sentiment

Market sentiment received a significant boost following optimistic comments from US Ambassador Sergio Gor. The newly appointed ambassador stated that no nation is as crucial to the United States as India, emphasizing that both countries are actively working to solidify a trade agreement. These remarks came just hours after he assumed his role and are viewed as a positive outreach effort by the Trump administration, which has recently applied pressure on India regarding tariffs and H1B visas.

Precious Metals Hit Record Highs

Gold and silver prices on MCX achieved record highs on Monday, tracking a rally in international bullion prices driven by safe-haven demand. The surge came amid uncertainty over a Trump administration criminal probe into Federal Reserve Chair Jerome Powell.

Market Outlook and Technical Analysis

Ajit Mishra from Religare Broking noted that markets will respond to earnings reports from major IT companies TCS and HCL Tech during early trading on Tuesday. Geopolitical events and trade discussions will also remain important factors. Given the current backdrop of mixed signals and high volatility, experts recommend adopting a selective, stock-specific strategy with disciplined risk management.

Rupak De from LKP Securities observed that significant purchasing at Monday's low prompted a quick market recovery. The daily chart shows the index has established a piercing line pattern, indicating potential bullish reversal after several days of decline. However, the Nifty 50 faces resistance in the 26,000-26,100 range, with immediate support positioned at 25,650.

Expert Stock Recommendations

Market experts have identified eight stocks for intraday trading opportunities, providing specific entry points, targets, and stop-loss levels:

Sumeet Bagadia's Picks (Choice Broking)

Ganesh Dongre's Recommendations (Anand Rathi)

Shiju Koothupalakkal's Selections (Prabhudas Lilladher)

The technical analysis across these recommendations highlights various bullish patterns, support level bounces, and momentum indicators suggesting potential upside moves in the near term.

Market indices demonstrated resilience on January 12, staging sharp recoveries from intraday lows despite broader market weakness. The Nifty 50 and Bank Nifty both formed bullish reversal patterns, raising expectations for continued upward momentum in upcoming sessions.

Market Performance Overview

Both major indices showed strong recovery patterns during the trading session:

Despite the index gains, market breadth remained unfavorable with 1,866 declining shares against 1,044 advancing shares on the NSE, indicating selective buying rather than broad-based recovery.

Nifty 50 Technical Outlook

The sharp recovery from day's low, coupled with a bullish reversal pattern formation after a five-day correction, has improved the technical outlook for Nifty 50. The index managed to close well above the critical 25,700 support level, indicating a potential short-term bottom.

Key Technical Levels:

Technical indicators show improving momentum with the DMI indicating a positive crossover and RSI moving above the 50 level on the 30-minute chart. The Nifty Put-Call Ratio stands at 0.88 after falling to 0.50 intraday, reflecting more balanced market positioning.

Trading Strategies:

• ICICI Securities: Buy Nifty Futures on dips in 25,650-25,700 range, stop-loss below 25,450, target 26,000-26,100
• Anand Rathi: Buy Nifty Futures in 25,800-25,700 zone, stop-loss 25,550, target 26,200
• SMC Global: Buy Nifty Futures on dips near 25,750, stop-loss below 25,500, target 26,150

Bank Nifty Analysis

Bank Nifty demonstrated strong recovery, rebounding over 600 points from intraday lows to settle near 59,450. The index found crucial support in the 58,800-58,900 zone, which coincides with previous demand areas and key technical levels.

Critical Levels for Bank Nifty:

The index has decisively reclaimed its 35-day exponential moving average on the daily chart, keeping the broader trend constructive. Technical indicators mirror the positive momentum seen in Nifty 50, with DMI showing positive crossover and RSI above 50 levels.

Expert Recommendations:

• ICICI Securities: Buy Bank Nifty Futures on dips near 59,300, stop-loss 58,900, target 59,700-60,000
• Anand Rathi: Buy Bank Nifty Futures in 59,600-59,500 zone, stop-loss 59,100, target 60,300
• SMC Global: Buy Bank Nifty Futures on dips near 59,400, stop-loss below 59,100, target 59,900

Volatility and Market Sentiment

India VIX closed 4.05% higher at 11.37, moving toward its short-term target of 12. The volatility index is expected to see further upside until Budget Day, potentially testing the 13 level. This elevated volatility suggests continued market uncertainty despite the technical recovery.

Market sentiment improved following encouraging remarks on potential trade deals by the US Ambassador, contributing to the afternoon recovery. However, analysts recommend a buy-on-dips and sell-on-rallies strategy until there is a clear breakout from current ranges.

Trading Strategy Summary

Experts unanimously favor a cautious bullish approach with specific entry and exit points. The consensus suggests that Nifty 50 needs to sustain above 25,700 to maintain bullish momentum, while Bank Nifty requires a close above 59,000 for continued strength. Both indices face immediate resistance zones that could determine the next directional move, making precise risk management crucial for traders.