Nifty May Trail Asian Peers as Consolidation Likely Near Key Levels, Says CLSA Chartist

Nifty May Trail Asian Peers as Consolidation Likely Near Key Levels, Says CLSA Chartist​

The Nifty 50 index may remain a relative underperformer compared with other Asian markets and could move within a consolidation range over the next few months, according to CLSA chartist Laurence Balanco.

Speaking to CNBC-TV18 on March 10, Balanco outlined key technical levels for the benchmark index, expectations for oil and gold prices, and the outlook for major sectors and stocks.

Nifty Seen Consolidating Between 23,800 and 26,300​

Balanco expects the Nifty 50 to remain in a consolidation phase for the next three months. He highlighted 23,800 as a key support level, close to Monday’s low of 23,697.

On the upside, the index may face resistance near 26,300, which is close to its record high zone.

Despite this range-bound outlook, Balanco believes Indian equities could lag other Asian markets in the near term. The Nifty has declined 7.5 percent so far this year, while several major Asian indices have posted strong gains during the same period.

Among them:

• South Korea’s KOSPI has surged about 30 percent
• Japan’s Nikkei 225 has gained roughly 7 percent
• Taiwan’s benchmark index has risen around 13 percent

Oil Prices May Drop Toward $72 if Tensions Ease​

Oil markets have seen sharp volatility amid the conflict in West Asia.

Brent crude climbed to $119.5 per barrel on Monday, driven by escalating geopolitical tensions. However, prices dropped more than 10 percent to below $90 after US President Donald Trump indicated that the war with Iran could end soon. Crude has since recovered to around $95 per barrel.

Balanco pointed to historical trends showing that oil prices often fall sharply after conflicts end, sometimes dropping below the levels seen before the rally began.

Based on that pattern, he expects Brent crude to move toward $72 per barrel in the short term, provided de escalation continues.

Gold Prices Consolidating After Strong Rally​

Gold prices have cooled after an explosive rally earlier this year.

The precious metal surged to around $5,600 per ounce at the start of the year, extending the strong momentum seen through 2025. Prices have since pulled back but remain above $5,100 per ounce.

Balanco noted that gold has not risen significantly despite geopolitical tensions because a stronger US dollar and reduced expectations of US Federal Reserve rate cuts have limited haven demand.

According to him, gold may need time to absorb the sharp gains made recently. He expects strong support for bullion between $4,600 and $4,800 per ounce.

Reliance Industries Lacks Immediate Breakout Signal​

Shares of Reliance Industries have seen some profit booking on March 10 after gaining nearly 6 percent over the previous three sessions.

During the same period, the Nifty 50 declined about 2 percent, meaning the stock significantly outperformed the broader market.

However, Balanco does not see an immediate technical breakout for the stock. He pointed to ₹1,300 as a key support level, which also corresponds to the intraday low recorded on March 4.

The stock continues to trade below its recent record high of ₹1,611.8.

Nifty IT Remains in a Downtrend​

The Nifty IT index has fallen about 22 percent so far this year, marking its weakest start to a calendar year in decades.

All companies within the index are currently trading lower, with losses ranging from 12 percent to as much as 31 percent.

Balanco said the sector will remain in a downtrend as long as the index stays below 31,700, a level that is still around 6 percent higher than current levels. Until that threshold is crossed, the technical outlook for the sector remains negative.