Trade Setup For July 10: How Nifty May React To TCS Q1 Results - Key Levels To Watch

The Nifty 50 started Thursday's session on a positive note and touched an intraday high of 24,134.70 in early trade. This level marked nearly a 61.8% retracement of the previous day's decline. However, the index failed to sustain at higher levels and gave up more than 150 points from the day's high in the second half of the session. Despite this late weakness, the index ended higher by 80.75 points, or 0.34%, and snapped its two-day losing streak. However, the close below the psychological 24,000 mark kept the recovery muted.

Nifty Forms Inside Candle 

Thursday's price action resulted in the formation of an inside candle. This came after the previous session recorded the widest single-day range in over one month. The latest candle had a small green body and a long upper shadow, which indicates hesitation at higher levels. This suggests that while buying interest emerged after the recent decline, traders were not confident enough to carry positions aggressively.

Broader Markets Outperform

Although the Nifty moved above its 8-EMA and 20-DMA during the session, it slipped below both these averages by the close. The index also continues to trade below its 100-DMA, which remains an important hurdle. However, market breadth stayed strong, supported by clear outperformance in the broader market. The Nifty Midcap 100 and Nifty Smallcap 100 indices gained over 1% each, showing that stock-specific participation remained healthy. Meanwhile, India VIX declined nearly 9% to 13.36, indicating some cooling in volatility after the recent spike.

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Momentum Indicators Show Mixed Signals

On the daily chart, the MACD is close to generating a fresh bearish signal, which needs to be watched closely. The 14-period RSI has moved back above the 50 mark, suggesting some recovery in momentum. However, the weekly RSI continues to remain below 50, reflecting that the larger trend has not yet regained strong momentum. Positively, the index is still trading above its 10-week and 20-week moving averages, which prevents the broader structure from turning sharply negative.

Key Levels to Watch on Friday 

Going ahead, immediate support for the Nifty is placed near the 50-DMA at 23,825, followed by the lower end of the four-week range at 23,784. On the upside, the 100-DMA at 24,036 will act as the first resistance, followed by the 24,200 to 24,300 zone. As long as the index remains within the 23,784 to 24,300 range, traders may not get a clear directional bias. A decisive breakout on either side of this range would be important to determine the next meaningful move.

TCS Q1FY27 Results

Apart from technical levels, the market will also take cues from the start of the earnings season. Tata Consultancy Services (TCS) reported a net profit of Rs 13,349 crore for Q1FY27, up 4.6% from Rs 12,760 crore in Q1FY26. Revenue grew 13.9% on a reported basis to Rs 72,275 crore as against Rs 63,437 crore in the same quarter last year. Since TCS is one of the first major index heavyweights to announce results, the market reaction to its numbers could influence sentiment towards the IT pack and set the tone for early earnings season expectations.

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Stock to Watch: IIFL Finance

IIFL Finance gained over 5% on Thursday, taking the stock close to a two-week high. With this move, the stock is now on the verge of breaking out from a two-week consolidation phase. The upmove was supported by strong volumes, which were higher than its 10-day and 30-day average volumes, indicating healthy participation in the direction of the trend.

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