Budget 2025: Angel One shares Nifty, Nifty Bank technical outlook and key stocks to buy ahead of Budget

The Union Budget has historically been pivotal in driving stock market movements. The upcoming Union Budget for the financial year 2024-25 is expected to emphasise capital expenditure, bolster manufacturing growth, and maintain macroeconomic stability. Angel One said past budget announcements have significantly influenced the stock market by shaping sector trends through government policies and financial plans.

The Union Budget for FY 2024-25 is scheduled to be presented by Finance Minister Nirmala Sitharaman today, February 1, 2025, at 11 AM. Angel One noted that this crucial event will serve as a key barometer for the nation’s economic outlook and a roadmap for future growth.

On Budget Day, investors and market participants will closely monitor the government’s projections and analysis, which will provide valuable insights into domestic growth trends. Historically, budget announcements have had a pronounced impact on equity markets, and Angel One highlighted that this year is unlikely to be an exception. The measures introduced in the budget will shape investor confidence and market sentiment moving forward.

Technical Strategy by Angel One

Nifty: Angel One observed that the benchmark Nifty index has seen a steep correction over the past few months, falling below its 20-EMA and 200-SMA on daily charts. This decline has negatively affected market sentiment, with the formation of lower lows and lower highs raising concerns for the near term. However, Angel One pointed out that the index has formed a ‘Falling Wedge’ pattern on the daily chart and is currently hovering near its lower descending trendline. While market sentiment has been bearish, the current oversold conditions and critical support levels suggest a shift from a strictly bearish stance to a more cautious approach in the short term.

From a broader perspective, Angel One emphasised that such corrections have historically presented opportunities to accumulate fundamentally strong stocks for medium to long-term investment. 

On a technical level, Nifty is entering a crucial support zone of 22,800 - 22,400, where a rebound is possible unless a major disappointment arises from the budget or global factors. On the upside, Angel One identified the 200-DSMA around 23,800-24,000 as a crucial hurdle. A decisive breakout above this level could shift the market’s trend to a bullish stance, with an eventual target of 25,000 and higher in the long term.

Bank Nifty: Angel One highlighted that the Bank Nifty index is currently trading near its levels from early 2024, presenting an opportunity for potential gains. However, it remains below its 20-DEMA and 200-DSMA, indicating a challenging short-term outlook. Despite this, Angel One noted that historically, such market conditions have often led to significant pullbacks.

For now, the recent lows of 48,000, followed by the election day close around 46,900, serve as strong demand zones for the index. Angel One expects multiple resistance levels between 50,000-50,800 (200-DSMA). A decisive breakout above this range could lead to renewed bullish momentum, potentially retesting the lifetime highs, which is nearly 11 per cent above the current level.

Key Stocks to Watch Ahead of Budget

Ashok Leyland: Angel One pointed out that Ashok Leyland has faced selling pressure since peaking above Rs. 260 in September 2024. Historically, the stock has found support near the 89-EMA on the weekly chart, which currently aligns with the Rs. 200 level. The stock is also placed around the 20-EMA on the monthly chart, which has acted as a strong support zone. Given this technical setup, Angel One anticipates a potential short-covering rally and recommends buying Ashok Leyland in the Rs. 200-205 range, targeting Rs. 265 with a stop loss at Rs. 189.

HAL: Angel One noted that Hindustan Aeronautics has faced consistent selling pressure over the past seven months, except for a brief recovery in November. The stock has now reached a key support level at the 20-EMA on the monthly chart and the 89-EMA on the weekly chart. Angel One highlighted that stocks in this sector often attract attention during the Budget period, making HAL a potential rebound candidate. The brokerage recommends buying HAL in the Rs. 3,650-3,700 range, targeting Rs. 4,700 with a stop loss at Rs. 3,480.

JK Cement: Angel One observed that JK Cement has demonstrated relative strength in recent weeks, outperforming despite weakness in the broader market. The stock remains in a primary uptrend, characterized by a series of higher highs and higher lows. It is also forming a bullish ‘Cup and Handle’ pattern, indicating potential for further upside. Angel One highlighted that the 14-day RSI remains in bullish territory, and the stock is trading above all major EMAs. Based on this setup, the brokerage recommends buying JK Cement in the Rs. 4,880-4,700 range, with a target of Rs. 5,780 and a stop loss at Rs. 4,320.

SBI: After an 80 percent rally from its early 2023 lows, Angel One noted that SBI has retraced to the 38.2 percent Fibonacci level of its prior uptrend, offering a favorable entry point. The stock is currently trading near a strong short-term support zone that has been respected multiple times since early 2023. Angel One highlighted that SBI has also found support at its 89-EMA on the weekly chart, reinforcing its stability. Given the recent oversold market conditions, the brokerage expects a strong pullback in SBI and recommends buying the stock in the Rs. 755-735 range, with a target of Rs. 875 and a stop loss at Rs. 700.

As the Union Budget 2025 approaches, Angel One emphasized the importance of closely monitoring these key levels and stock recommendations. While market conditions remain volatile, strategic positioning based on technical insights could offer significant opportunities for investors in the near term.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.