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Below the Quote on Pre-market comment for Monday July 13 by Sachin Gupta, VP-Technical Research at Choice Broking

Indian equity markets are expected to open on a weak note, with Gift Nifty trading at 24,050, down by 199 points. Asian markets recovered from early weakness and traded modestly higher despite geopolitical concerns following the latest US-Iran strikes over the weekend. However, the negative indication from Gift Nifty suggests a cautious start for domestic equities amid heightened uncertainty and potential risk-off sentiment

In the previous session, the Nifty 50 extended its recovery for the second consecutive day and gained nearly 1 percent. The index reclaimed its short- and medium-term moving averages along with the 100-day EMA, signalling improvement in market sentiment after the sharp correction witnessed earlier in the week. While the recovery has strengthened the technical structure, the index remains below a crucial long-term hurdle, suggesting that confirmation of a sustained uptrend is still awaited.

From a technical standpoint, the Nifty 50 formed a bullish candlestick with a minor upper shadow after a gap-up opening, indicating continued buying interest despite some profit booking at higher levels. The index moved above its 10-day, 20-day and 100-day EMAs while sustaining above the 50-day EMA. Additionally, it reclaimed the falling resistance trendline and crossed above the 23.6 percent Fibonacci retracement level of the recent correction, reflecting improving price structure.

Momentum indicators have also shown signs of recovery. The RSI rose to 55.80 and is approaching a bullish crossover, while the MACD remained above its signal line with the green histogram bars expanding further. These developments indicate strengthening short-term momentum and support the possibility of further recovery if key resistance levels are surpassed.

The immediate hurdle for the Nifty remains near the 24,400 level, which coincides with the 200-day EMA and remains a critical resistance zone. A decisive move above this level could trigger a fresh leg of the rally towards 24,600–24,800. On the downside, 24,000 is expected to act as immediate support, followed by the crucial 23,800 level. A sustained breach below 23,800 could increase the probability of a broader consolidation phase.

Derivatives data continues to reflect a positive undertone. The Nifty Put-Call Ratio (PCR) improved sharply to 1.25 from 0.94, indicating aggressive put writing and strengthening bullish sentiment among derivatives traders. The elevated PCR suggests that market participants continue to build support positions at lower levels.

The India VIX declined by 8.31 percent to 12.25, extending its decline after the sharp spike seen earlier in the week. The volatility index has slipped below its short-term moving averages, indicating improving comfort among market participants. A further decline towards the 10–11 zone would provide additional support to bullish sentiment and improve market stability.

Option chain positioning indicates strong support around the 24,000 strike, where put writers remain active. On the upside, significant call writing is concentrated around the 24,400–24,500 zone, making it the immediate resistance area for the index. A breakout above this zone could lead to fresh short covering and accelerate the upward move.

Bank Nifty also witnessed strong recovery and formed a long bullish candlestick with an upper shadow for the second consecutive session. The banking index moved back above its short-term moving averages while continuing to trade comfortably above its medium- and long-term moving averages. The RSI improved to 58.38, although it remains below its reference line. Meanwhile, the MACD continues to stay below its signal line, but the narrowing red histogram bars indicate weakening bearish momentum. This suggests that the broader trend remains positive and the recent weakness may be gradually fading.

Overall, the technical setup continues to favour the bulls despite a weak opening indication from Gift Nifty. The broader trend has improved significantly over the last two sessions, supported by strengthening momentum indicators, lower volatility and bullish derivatives positioning. However, the 24,400 level remains the key trigger for a sustained rally, while 24,000–23,800 remains the crucial support zone. The immediate trading range for Nifty is expected between 24,000 and 24,400, and a decisive breakout on either side is likely to determine the next directional move.

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