IGI Logo

Nifty : 23414

Technical Outlook

Day that was ..

Equity benchmark started the week on a positive note, extending its localized pullback. Nifty gained around 68 points to settle at 23414, and the benchmark has outperformed midcap and small cap indices today. Market breadth remained in favor of advances, reflecting broad-based buying across the tape. Sectorally, Realty, Pharma and Consumer Durables witnessed traction while Metals and PSU Banks saw subdued action amid mild profit booking.

Technical Outlook :

• The daily price action resulted into bull candle with a higher-high and higher-low structure indicating a continuation in the upward bias.

• Structurally, the large range candle formed on 15th September continues to govern near-tern price action, with all subsequent session trading completely inside its high-low boundaries.

• Going ahead, a decisive breakout and close above the high of the 15th September candles is the primary prerequisite to confirm the conclusion of the corrective phase and open the door for an extended pullback towards the 24000 mark in the coming days. Stabilisation in BankNifty would act as a positive catalyst for Nifty given its significant weightage in Nifty.

• In the interim, price action is likely to maintain a base-building consolidation rhythm. Sustaining above Monday’s intraday low of 23314 is vital to keep the immediate pullback option open toward the 23500 overhead resistance.

• From the medium-term perspective, on the downside, key support is placed at 22700 coinciding with the 80% macro retracement of the April-August rally, which serves as a major structural floor.

• On the commodity front, the index continues to witness an inverse correlation with Brent crude and the dollar. Crude oil has formed a double top at $110, and a sustained downtrend from here could signal further upside for Indian equites. With energy prices cooling and the dollar stabilizing, the macro environment is turning supportive for domestic equities.

Key Monitorable :

1. Geopolitical developments and energy-supply risks

2. Crude oil trajectory and global inflation expectations (cool-off in crude combined with Rupee depreciation could provide cushion)

3. US yields, dollar strength, and emerging-market flows 4. Relative strength in Bank Nifty and resilience in broader markets

Intraday Rational :

• Trend – Higher-high higher-low structure indicates a pause in the downward trend.

• Levels – Buy around 80% retracement of Mondays up move

Nifty Bank : 56470

Technical Outlook

Day that was :

Bank Nifty ended the day on marginally positive note, at 56470 up 0.2% on back of mixed global cues.

Technical Outlook :

• Index started the week with a positive opening and traded northwards as intraday pullback were brought into . As a result, daily price action formed a bull candle with higher high higher low, reflecting an improvement in short-term sentiment.

• Bank Nifty has relatively outperformed in current corrective phase. It is approaching the 56,570–56,700 resistance zone, where a decisive and sustained move above the previous session's high could strengthen the recovery structure. Meanwhile, a decisive close above the previous session high of 56668 will open the door for a potential pullback towards 57600 being 80% retracement of current decline(58025-55700).

• Immediate support is placed around 55700-55800 remains important support area being 50% retracement of May-June rally (52783-58706).

• Sustainability below the same would result into extension of corrective bias towards 55500, representing a 38% retracement of the April–June rally (46,935–58,706).

• The PSU Bank Index formed small bull candle closing above its 52-week EMA, indicating supportive efforts at lower levels. Going ahead, holding 8150 will lead to pullback towards 8600 levels being 61.8% retracement of current decline.

• Intraday Rational :

• Trend - Prolongation of consolidation around 52 weeks EMA

• Levels: Buy around 80% retracement of Mondays up move

Please refer disclaimer at https://secure.icicidirect.com/Content/StaticData/Disclaimer.html

SEBI Registration number INZ000183631