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Nifty : 24395

Technical Outlook

Day that was ..

Equity benchmark settled the choppy session on a flat note at 2396, down 40 points. Broader markets relatively outperformed with Nifty smallcap gaining 0.3%. Sectorally, Realty, Consumption, IT remained in limelight while metal, financials took a breather.

Technical Outlook :

• Nifty traded in a narrow range through out the day. Consequently, forming an inside bar, indicating prolonged consolidation in the vicinity of 200 days EMA.

• The index as been undergoing healthy consolidation as over past eight sessions it retraced merely 50% retracement level of preceding seven session ~1150-point upmove, indicating slower pace of retracement that helped index to cool off the overbought conditions.

• It is important to highlight that, during past eight sessions index failed to sustain above previous sessions high. Thereby, a decisive close above previous session high would be required to pause the ongoing corrective move and resolve higher towards 24600 in coming sessions. In the process, immediate support is placed at 24000 levels being placement of three months rising trend line that coincided with gap area seen during 29th July (24040-24136).

• Structually, since April 2026, index has seen forming “higher lows” while pricing in host of negative news on geopolitical uncertainty and crude oil volatility. Hence as long as Nifty holds above the previous swing low of 23600, the positive bias remains intact. A decisive breakout above upper band of past four months consolidation (placed at 24600) would trigger the next leg of up move. Thereby, any decline from current levels should be capitalized to accumulate quality stocks backed by strong earnings.

Our constructive stance is based on following observations :

I. Over past three decades there have been 8 occasions where Nifty has remained below its 200 days EMA for at least four months. The subsequent move, after reclaiming its 200 days EMA has been noteworthy as it delivered average returns of 12% to 19% over the next 3 to 6 months. In the current scenario, the index has reclaimed its 200-day EMA after four months consolidation.

II. The Midcap index continued to record fresh highs while small cap index traded in the vicinity of All Time High that is backed by significant improvement in the broader market as currently 54% of stocks of Nifty 500 universe are trading above 50 days SMA compared to two weeks back reading of 41%

Intraday Rational :

• Trend – over the past seven sessions, the index has retraced merely 50% retracement level of preceding seven session ~1150-point upmove, indicating slower pace of retracement.

• Levels – Buy around Thursday’s low

Nifty Bank : 57635

Technical Outlook

Day that was :

Bank Nifty ended the day on negative note down 0.43% at 57635 on back of mixed global cues.

Te chnical Outlook :

• Index started the day on a negative note and thereafter remained range bound throughout the day inside previous session high-low range indicating breather. As a result, the daily price action has resulted into Inside bar indicating consolidation.

• Index took a breather after previous session up move indicating healthy consolidation. Going ahead, we believe resumption of uptrend will help index to head towards 58500 and that would eventually set the stage higher in the coming week. IN the process strong support is placed around 56800 being the placement of four months rising trendline coincided with 100 days EMA

• Another observation is that over last 6 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.

• The PSU Bank Index has formed bear candle but maintained higher high higher indicating positive follow through to previous session bull candle indicating positive. Going ahead, follow through strength above last week week(8870) high would open the door for next leg of up move towards 9100 levels

Intraday Rational :

• Trend - Prolongation of consolidation in vicinity of 57500, indicating positive bias

• Levels : Buy around 61.8% retracement of Wednesday range.

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