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Nifty : 23767

Technical Outlook

Week that was ..

Equity benchmark concluded the week on a negative note down 2.3% at 23,767 amid escalating geopolitical tension and spike in crude oil prices weighed global sentiment. Broader market continued with its breather over second consecutive week wherein stock specific activity prevailed while navigating Q1FY27 earnings. Midcap, Small cap index down ~2%. Sectorally, auto, consumption displayed resilience while financials and realty extended breather.

Technical Outlook :

• Nifty opened the week on a flat note and extended its decline on the breach of previous week’s low (24000). The weekly price action resulted into bearish candle confined within prior 5-week’s range, indicating extended breather.

• Indes is likely to open gap-up on back of positive geopolitical developments and cool off in brent crude prices. Key highlight is that despite gap down opening and Brent crude climbed near $100 index has managed to defend its short-mid term three months rising trend line placed at 23600. Going ahead, sustain and close above previous session high would be a first sign of pause of corrective phase. Failing which will result in to an extended correction where is next key support is placed around 23300 zone, being 80% retracement of last upmove (23070-24530).

• Notably, global macroeconomic trends will remain the primary driver of market direction in the coming weeks. Amid persistent geopolitical tensions, crude oil dynamics and the Indian Rupee are the key variables to track. A pull-back in crude oil along with rupee stabilization will provide cushion for the Nifty.

• On a broader market perspective, Both Mid and Small-cap index is currently witnessing a breather post a sharp upmove that has led to cooloff in the technical overbought condition. With the ongoing profit booking index has retraced its previous multi-year trendline breakout area which can now act a support as per change of polarity principle Hence focus should be on accumulating quality Mid and Smallcap stock supported by strong Q1 results.

• Structurally, the Nifty has been consolidating within a 1,500-point over the past quarter. Defending the pivotal 23,000 mark is crucial to establish a higher base, which would set the groundwork for the next leg of the secular uptrend

Key Monitorable :

a) Historical data of Brent crude oil suggest that bounce after a sharp decline in amid geopolitical conflict (Iraq war 1990-91, Russia Ukraine 2022) typically cap around 40%. In the current scenario, Crude has rallied over 40% from recent low of $70 and retreated from the $100 mark.

b) Empirically, after such a pattern crude undergoes consolidation and eventually revisits the panic low in subsequent quarters. Therefore, we believe falling crude oil would be the primary catalyst to reignite momentum in equities.

c) US Federal Policy

d) Monthly Expiry

Intraday Rational :

• Trend – Supportive efforts emerged from 3 months rising trendline, indicating broader structure remains intact

• Levels – Buy around Fridays close.

Nifty Bank : 56693

Technical Outlook

Week that was :

Bank Nifty remained southward throughout the week and settled week on a negative note at 56693, down 3.1%

Te chnical Outlook :

• After negative opening index remained southward most part of the week as intraday pullback were short lived. Consequently, the weekly price action resulted into bear candle with lower high lower low and settled in vicinity of 52-week EMA indicating extended breather.

• The lack of follow-through strength resulted into prolongation of consolidation in 56000-58000 zone over past six weeks. Despite, geopolitical concerns, index managed to defend the 3 months rising trend line placed at 56000 mark.

• In today’s sessions, Bank Nifty is likely to witness gap up opening tracking sharp decline in crude oil prices. We expect, index to hold the key support zone of 56000-55500 and gradually head towards upper band of consolidation placed at 58500 in coming month. The key support zone of 56000-55500 is a placement of the 38.2% retracement of entire rally (49954-58706) and gaparea is placed around 55,500 levels.

• Another observation is that over last 3 weeks Index has retraced by 38.2% of earlier 3 weeks rally, indicating slower pace of retracement which would help to set stage for next leg of rally.

• PSU Bank Index has formed high wave candle and is seen taking breather above 52-week EMA, thereby reaffirming strong base at 8100 levels. Going ahead follow through strength above last weeks high would set the stage towards 9100 levels

Intraday Rational :

• Trend - Supportive efforts emerged from the lower band of the contracting triangle

• Levels – Buy around Fridays close

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