Budget is done! Bulls need to keep Nifty above 23,280 for further momentum, say technical analysts
Sensex and Nifty ended a volatile trading session on February 1 on a flat note as the Union Budget failed to provide major triggers for retail investors and the broader market. The indices had been rallying for the past four sessions ahead of the Budget announcement.
The government’s move to exempt annual income of up to Rs 12 lakh from tax and a revamp of tax slabs provided some support, driving gains in consumption-linked sectors. However, concerns over a lower-than-expected increase in capital expenditure allocation for FY26 kept market sentiment subdued.
The BSE Sensex closed nearly unchanged, gaining 5.39 points or 0.01 percent to settle at 77,505.96, while the NSE Nifty slipped 26.25 points or 0.11 percent to end at 23,482.15.
Key Technical Levels to Watch
Market observers are now keenly watching Nifty’s 23,280 level for near-term direction.
"Nifty witnessed a roller-coaster session during the Budget day. A small-bodied candle has formed on the daily chart, indicating indecision. As long as Nifty stays above 23,280, the broader trend remains positive, with potential upside towards 23,700–24,000 in the short term. However, if the index slips below 23,280, it could trigger panic selling," said Rupak De, Senior Technical Analyst, LKP Securities.
Ajit Mishra, SVP (Research), Religare Broking Ltd, noted that the Nifty, after a sluggish start, attempted to gain momentum but faced resistance near the long-term 200-day exponential moving average (DEMA), closing at 23,482.15. "Sectors such as FMCG, auto, and real estate benefitted from tax relief measures, while defence, energy, and infrastructure stocks struggled. Broader indices remained mixed. The impact of the Union Budget could continue to play out in the coming sessions, especially in consumption sectors," he added.
Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities added, "The underlying trend of Nifty remains positive and the market is facing stiff resistance around 23,500-23,600 levels. A decisive move above this hurdle could open further upside towards 24,000 levels in the near term. Immediate support is placed at 23,300 levels."
Among the top performers, Zomato surged over 7 percent, while Maruti Suzuki, ITC Hotels, ITC, Mahindra & Mahindra, Asian Paints, Titan, and IndusInd Bank also ended with strong gains.
Ankur Aggarwal, Chairman, CropLife India and Managing Director of Crystal Crop Protection Ltd. noted the Government’s well-defined vision to prevent migration from rural areas, coupled with the scheme that prioritizes women and youth, is a welcome and forward-thinking step."
“The Union Budget announcement regarding the Insurance sector has come as a welcome move for the industry. The increment of FDI limit to 100% from 74% will prove to be a significant shift for the Indian Insurance Sector", added Pallavi Malani, India Leader-Insurance Practice, BCG.Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.