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Nifty : 25150

Technical Outlook

Day that was…

* Indian equity benchmarks extended breather over second consecutive week amid lack of clarity on India-US bilateral trade deal. Consequently, Nifty settled the week at 25150, down 1.2% for the week wherein broader market relatively underperformed by losing >1.5%, each. Sectorally, barring FMCG all sectors closed in red, while, IT, Metal and Auto underperformed.

Technical Outlook:

* Index after the initial three days sideways consolidation and broke the range on the downside. The weekly price action formed a bear candle carrying lower high-low, indicating extended breather.

* We expect volatility to remain elevated amid progression of earning season coupled with Tariff related development wherein strong support is placed at 24800 levels. Currently, index is undergoing healthy consolidation wherein over past 10 sessions Nifty has merely retraced 50% of preceding 10 sessions up move. Slower pace of retracement while trading in the vicinity of 20-days EMA, highlights robust price structure. Hence, any dip from hereon should be capitalised to accumulate quality stocks with strong earnings as we expect Nifty to gradually resolve higher and head towards 25800 in coming month.

* Key Monitorable which will dictate the further course of action:

* a. All eyes will be on outcome of US-India bilateral trade deal coupled with progression of Q1FY26 earning season which will dictate the further course of action.

* b. Falling US Dollar index would act as boon for equities that would eventually result into FII's inflow.

* c. India VIX has extended losses and likely to close at one year low of 12, indicating participants anxiety at lowest level.

* Structurally, the formation of higher peak and trough while absorbing host of negative news around geo-political uncertainties coupled with clarity of trade tariff. Further, strong market breadth depict strength as currently 60% stocks of Nifty 500 universe are trading above 200-days SMA compared to last month's reading of 52% that bodes well for durability of ongoing structural up move.

* The formation of higher-high-low makes us maintain our support base at 24800 for the Nifty which is based on 50% retracement of recent rally (23936-25669) and 50-day EMA.

Nifty Bank : 56755

Technical Outlook

Day that was

* The Bank Nifty remained subdued for a second straight week, weighed down by ambiguity over the India -US trade agreement and closed the week at 56755 , down 0 .49 % . The Nifty Pvt Bank index closed on a flat note, and ended at 28 ,075 , 0 .03 % 

Technical Outlook :

* The Bank Nifty remained range -bound for the first four sessions, and broke the range on the fifth day, registering a lower -high -low, suggesting continuation of the breather .

* Key point to highlight is that Bank Nifty has not even retraced 38 . 2 % of the prior 13 -session up move over the past 7 -sessions, indicating a slow, shallow pullback and a strong price structure . The index remains above its 20 -day EMA, a level it has consistently held since April, signaling the bull market template is intact . This, coupled with positive market breadth, supports the ongoing higher - high -low structure, underscoring a well -established uptrend which open the gates towards 58800 levels in coming quarter which is the implied target of the consolidation from (56098 -53483 ) . The support base is maintained at 55 ,500 , which represents the 50 % retracement of (53 ,483 –57 ,628 ) and aligns with the 50 -day EMA . Consequently, any dip from current levels could offer fresh buying opportunities .

* Underperforming the benchmark, PSU bank witnessed profit booking after the 8 % upmove, indicating breather . After breaking out from an eleven -month falling trendline on 19th May, the index has maintained a higher -high -low structure on the weekly chart, signaling an intact uptrend . While Bank Nifty trades below ~ 1 % from its all -time highs, the PSU Bank index remains about 14 % below its all -time high, presenting a compelling case for a catch -up move . Immediate support on the downside is placed at 6 ,700 , which is the recent swing low and coincides with the 20 -week EMA .

* Structurally, Bank Nifty is undergoing phase -wise expansion, with each rally establishing new price zones of acceptance . Instead of sharp directional moves, the index is progressing through brief consolidations that serve as launchpads for subsequent advances . This transition from volatility -driven swings to range -bound bases suggests increasing market maturity, with demand emerging at higher levels . The narrowing amplitude of corrections indicates that stronger hands are absorbing supply, maintaining trend continuity .

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