MUMBAI β The Indian equity benchmark, Nifty 50, continues to exhibit a complex tug-of-war between bullish domestic triggers and cautious global sentiment as January 2026 draws to a close. As of January 29, the index has shown remarkable resilience, successfully defending the psychological 25,000 mark while eye-balling immediate resistance levels ahead of the upcoming Union Budget.
Key Levels to Watch
Following a volatile start to the year, the Nifty 50 has shifted into a range-bound phase. Technical analysts observe that the index is currently building a strong base near the 25,150β25,200 zone.
Immediate Support at 25,150 level, coinciding with the 100-day Exponential Moving Average (EMA), remains a “must-hold” for the bulls. A breach below this could potentially drag the index toward the 24,900 support corridor.
Resistance Zones on the upside, 25,450 acts as the primary hurdle. A decisive close above 25,500 is required to ignite a fresh rally toward the previous lifetime highs near 26,300.
The Relative Strength Index (RSI) is currently hovering near the 45-50 mark, suggesting a neutral momentum that could tilt in either direction based on upcoming policy announcements.
One of the most significant tailwinds for the market this week has been the formal conclusion of the India-European Union Free Trade Agreement (FTA). The landmark deal has sparked renewed interest in export-oriented sectors, particularly Metals, Textiles, and Chemicals.
Additionally, the signing of the MoU between the RBI and ESMA regarding Central Counterparties has eased regulatory concerns for European institutional investors, potentially paving the way for smoother foreign portfolio investment (FPI) inflows.
The narrative of 2026 continues to be the balancing act between Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs). While FIIs have remained net sellers in several sessions this monthβciting high valuations and currency fluctuationsβDIIs have consistently provided a liquidity cushion, absorbing selling pressure through robust SIP inflows and insurance fund allocations.
Market participants are increasingly turning their attention to the Union Budget 2026. The Nifty Bank has shown relative strength, supported by strong Q3 earnings from private sector heavyweights. Meanwhile, sectors such as Defense, Railways, and Green Energy are witnessing “pre-Budget accumulation” as investors bet on continued government capital expenditure.
The market is currently in a ‘wait-and-watch‘ mode,” notes a senior market strategist. “While the India-EU trade deal provides a long-term structural positive, the immediate direction of the Nifty will be dictated by the fiscal roadmap presented in the Budget and the management of the fiscal deficit.”
Outlook for the Coming Week
In the near term, the Nifty 50 is expected to remain highly sensitive to global cues and news flows. Traders are advised to maintain a “buy on dips” strategy as long as the 25,000 level holds on a closing basis. However, caution is warranted near the 25,600 supply zone, where profit-booking is likely to emerge.
Also Read: RBI Signs Landmark MoU with ESMA to Restore Recognition for Indian Central Counterparties