BankNifty after initial decline continued its upward journey in rest part of the week- ICICI Direct
Nifty : 23622
Technical Outlook
Day that was .. A potential US-Iran peace deal, falling crude oil prices boosted the market sentiment. Nifty erased early losses to settle the week on a positive note at 23622, up 1%. Meanwhile, midcap remained flat and small cap gained ~0.5%. Sectorally, financials lead the recovery along with FMCG, pharma while IT, Metal underperformed.
Technical Outlook :
• Despite Monday’s gap down opening, Nifty managed to defend key support threshold of 23100. Friday’s sharp up move further fueled momentum, driving Nifty above the hurdle of 23500. The weekly price action resulted into piercing line bull candle, indicating pause in corrective bias.
• Index is likely to witness gap-up opening tracking buoyancy in the global markets on the back of trade deal news and fall in Brent crude prices. With this gap up opening, index is likely to breakout from five months falling trend line, indicating conclusion of corrective phase that open the door for Nifty to head towards 24500 in the coming weeks.
• Structurally, since its April 2026 peak, the index underwent a slower pace of retracement wherein it retraced 61.8% of April rally (11%). This corrective phase has been captured in a contracting triangle pattern wherein after~4% correction index retraced 61.8% to 80% in subsequent 8-9 days. In current scenario, after 4% correction index spent 7 sessions consolidating above 61.8% retracement of entire rally and now with todays gap up opening, likely to retrace the recent fall entirely. This structural development augurs well for resumption of uptrend. Hence any decline should be used as incremental buying opportunity as strong support is placed at 23100. Our Constructive bias is based on following observation :
• The current positive development on geopolitical de-escalation front would result into further decline in Crude oil prices. This would be the key catalyst for Nifty for next leg of up move
• Bank Nifty has done the heavy lifting, as RBI amendments fueled the momentum, resulting into breakout from two month falling trend line which would drive Bank Nifty towards 57800 in coming weeks
• Nifty midcap has taken a breather after clocking fresh high. Post earning revival is expected to trigger healthy catch up in small cap index which is still 9% away from All Time high
Key Monitorable :
a) US Fed Policy
b) IIP Data
c) Crude Oil: Brent crude is trading at two months low below $85 mark. Confirmation of geopolitical de-escalation will result into further cool-off in oil prices, boosting Indian equities market
Intraday Rational :
• Trend – With Friday’s swift up move, Nifty has finally closed above immediate hurdle of 23500, indicating positive bias
• Levels – Buy around Fridays high
Nifty Bank : 56814
Technical Outlook
Week that was :
Bank Nifty Index closed the volatile week on positive note at 4.2% at 56814. Nifty PSU Bank remained in uptrend gaining 3.2%.
Technical Outlook :
• BankNifty after initial decline continued its upward journey in rest part of the week. The weekly price action resulted into strong bullish belt hold line candlestick with similar open and low indicating buying demand from lower levels
• Index is likely to open gap-up on back of trade deal news and fall in Brent crude prices .On expected line BankNifty closed above 200-day EMA and previous swing indicating positive momentum intact. Going forward we expect Index head towards target of 57800 levels being March 2026 in coming weeks,
• Index has witnessed slower pace of retracement. Where in it is important to note that over five weeks it has relatively outperformed Nifty, as we have seen Nifty breaching May lows but Banknifty resilience. defended May low and now forming higher base indicating This makes us believe to revise support upward towards 55000 levels being 61.8% retracement of current up move coinciding with 50-day EMA.
• Nifty PSU Bank Index formed belt hold line candlestick and close above past two weeks high.Structurally Index over past four weeks forming higher base above 52-week EMA. Going ahead we expect Index to regain momentum and head towards 8800 levels being 80% retracement of current decline(9095-7800)
Intraday Rational :
• Trend - Closed above long-term 200-day EMA hand previous swing indicating positive momentum intact.
• Levels - Buy around Fridays highs.
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