Bank Nifty opened negative, found support near 50% retracement at 58100 - ICICI Direct
Nifty :25875
Technical Outlook
Day that was…
Equity benchmark extended gains over fourth consecutive session and settled on a flat note at 25880 ahead of Bihar election outcome. Market breadth remained flat as broader market relatively underperformed the benchmark. Sectorally, Pharma, Metal outshone while, auto, PSU Bank took a breather
Technical Outlook:
* The index continued with its northbound journey and approached psychological mark of 26000. However, profit booking from higher levels dragged index near Wednesday’s close. Consequently, daily price action formed a doji like candle, indicating breather ahead of Bihar election outcome.
* Today, Nifty is likely to witness gap down opening tracking weak global cues. Going ahead, we expect volatility to remain elevated amid Bihar election outcome, with the 25,700-gap zone positioned as immediate intraday support . Hence, the positive outcome would boost the market sentiment. Further, positive development on US-India Tariff negotiations would open the door for next leg of up move towards 26300 in the coming weeks. Failure to sustain above the psychological mark of 26000 would indicate prolongation of consolidation in the 26000-25300 range amid stock specific activity. Thereby, focus should be on accumulating quality stocks on dips that are backed by strong earnings
Following observations makes us reiterate our positive stance:
* The index extended gains over fourth sessions and recovered most of last two week’s decline. Consequently, forming higher high-low on the weekly chart, indicating resumption of uptrend.
* While sailing through global volatility, Midcap index has relatively outperformed the benchmark move and marks a new all-time high, highlighting relative outperformance.
* In contrast with Q1FY26 earnings, the lack of disappointment on earning front has provided cushion to the market that would pave the way for next leg of up move
* Since 2000, November has given positive returns with 66% strike rate wherein average returns have been >2%
* Sectorally, BFSI, Auto, Metal are expected to endure their northbound journey
Key Monitorable for the next week:
* Bihar Election outcome
* Development on India-US tariff negotiations
* U.S. Dollar Index: Once again Dollar index has retreated from upper band of four months consolidation placed at 100. Follow through weakness would be positive for emerging markets
Nifty Bank : 58382
Technical Outlook
Day that was:
Bank Nifty extended its gain for the fifth-consecutive session to settle the day at 58382 up 0.2%. The Nifty Private Bank index has performed in line with benchmark and closed positive to settle at 28166 up 0.2%
Technical Outlook:
* Bank Nifty opened the session on negative note and witnessed supportive efforts around 50% retracement of last 2 days upmove around 58100. However, index made new high indicating overall positive momentum intact. Daily price action formed is bull candle with upper shadow indicating profit booking at higher levels.
* Index is likely to witness gap-down opening followed by weak global cues. Heading into today’s Bihar election outcome, the index is likely to witness elevated volatility. A positive outcome will result into breakout close above the October high of 58600 that would pave the way for the next leg of the up move towards the revised target of 60,000, which corresponds to the measured move projection derived from the current consolidation range. Failure to do so will result into consolidation in the range (58600-57200).
* Momentum indicators such as the RSI continue to sustain above the 60 level on both weekly and monthly timeframes, maintaining a positive medium-term bias. Hence, focus should be on accumulating quality stocks on dips backed by strong earnings as immediate support is placed near 56,900, corresponding to the 38.2% retracement of the ongoing advance (54,226–58,577).
* Historically, there have been 17 instances over the past two decades where Bank Nifty, following a decisive breakout above its previous two-month high, delivered double-digit returns within the subsequent four months. In the current setup, the index has once again confirmed a breakout above its prior two-month high and surpassed the previous all-time peak, reaffirming the prevailing bullish structure. This setup indicates a high-probability continuation pattern for sustained upside momentum in the coming months.
* The PSU Bank Index continues to outperform, maintaining a higherhigh, higher-low formation for the tenth-straight week on the back of strong Q2 earnings. In near term, index is witnessing series of healthy consolidation after sharp up move. However, any dip from hereon should not be construed as negative instead capitalized it as buying opportunity in quality stock as strong support is placed near 7,800, aligning with the 38.2% retracement of the latest rally (6,730– 8,391)
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