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Nifty:26068

Technical Outlook

Week that was…

Defying the global trend Nifty extended gains over second consecutive week and settled at 26075, up 0.6%. Meanwhile, broader market underperformed as smallcap lost 2%. Sectorally, IT continued to bounce back coupled with BFSI and auto, meanwhile realty, metal underperformed.

Technical Outlook:

* Nifty kicked off the week on a firm note despite bouts of volatility and maintained upward momentum. The weekly price action formed a bull candle with a higher-high and higher-low formation, indicating inherent strength.

* Today Nifty is likely to witness positive opening tracking firm global cues. Key point to highlight is over past two-week US and European markets corrected more than 5%, while Nikkie has corrected more than 8%. In the meantime, defying the global trend, Nifty has rallied 3.5% over past 2 weeks underscoring relative outperformance.

* Going ahead, a decisive close and a follow through strength above All Time high of ~26300 would open the door for revised target of 26800 in the coming month. We believe, sustainability above 26300 would revive market sentiment resulting into broad based participation. Hence, focus should be on accumulating quality stocks backed by strong Q2 earnings, especially from broader market space as Nifty small cap index has approached key support threshold of 200 days EMA. Meanwhile, strong support for the Nifty is placed at 25,600 as it is 61.8% retracement of Sept-Oct rally (24588-26104) coincided with 50 days EMA

Following observations makes us reiterate our positive stance:

* The current leg of up move is led by Bank Nifty and followed by Midcap index which has hit a fresh all-time high this week, while Nifty is shying away 0.5% from its peak. Meanwhile, Small cap index is still trading below 10% from its all-time high. We expect, catch up activity to gradually pan out in small cap space in coming weeks

* Strong Q2 earnings and improving macro indicators bodes well for durability of ongoing up move.

Key Monitorable for the next week:

* US and India Tarde Deal: Tracking nearing closure news of the US and India trade deal has kept Indian market upbeat. The favourable outcome could accelerate the positive momentum in the market and pave the way for return of FII’s in the Indian markets.

* GDP data: US & India

* Brent Crude Oil: dropped ~3% during the week. Further cool off in Brent crude oil bodes well for domestic market

* Indian Rupee: Indian Rupee has depreciated and recorded new low of 89.50. Further decline in rupee could temper market sentiment

Intraday Rational:

* Trend- Breather after recent up move offers incremental buying opprtunity

* Levels: Buy on declines near 61.8% of previous days upmove (25856- 26246)

Nifty Bank : 58867

Technical Outlook

Week that was:

Bank Nifty extended its winning streak for third-consecutive week to settle at 58867 up 0.6%. The Nifty Private bank index has mirrored the benchmark, closing firmly in green at 28,396 up 0.7%.

Technical Outlook:

* Bank Nifty opened the week with a positive gap-up and extended its upward momentum. However, profit booking emerged during Friday’s closing hours, dragging the index back toward its weekly opening levels. As a result, weekly price action formed a small bull candle, indicating a temporary pause within the ongoing uptrend.

* Key point to highlight is that index continues to trade within its rising channel since September 2025, supported by a recent breakout from a 4-week consolidation range (57,158-58577), indicating sustained upward momentum and a strengthening bullish structure. Going ahead, we believe that only a decisive close below the previous week’s low would signal a pause in the ongoing uptrend, otherwise the upward momentum is expected to continue.

* Hence, any dip from hereon should be viewed as a constructive pause within the broader uptrend, offering an opportunity to accumulate quality banking names, especially those delivering strong Q2 earnings performance as immediate support is placed near 58,000, being 50% retracement of the ongoing advance (57,157–59,440) and expect the index to gradually resolve higher towards our projected target of 60,000 in the coming month.

* 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 has relatively underperformed the benchmark index this week. However index managed to maintaining a higher-high -low formation for the twelve-straight week on the back of strong Q2 earnings. The index has advanced ~1800 points(+27%) over the last 12 weeks, pushing the stochastic oscillator into the overbought territory on both weekly and monthly timeframes hence, increases the probability of short-term healthy consolidation phase. 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 7,900, aligning with the 38.2% retracement of the latest rally (6,730–8,624) and 50-day EMA.

* Intraday Rational:

* Trend- Higher base formation above previous breakout zone (58,577)

* Levels Buy on declines near 50% retracement of previous five upmove (58050-59440)

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