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Nifty :25003

Technical Outlook

Week that was…

• Indian equity benchmarks snapped two weeks decline ignited by RBI repo and CRR cut. The Nifty settled the week at 25003, up 1.02%. Market breadth was in favor of advances, with an A/D ratio of 1.35:1, as the broader market outshined. Sectorally, barring IT all sectors closed in green where, Realty, Metal and PSU Bank stole the show.

Technical Outlook:

• Nifty opened the week on a negative note, and traded within the range of 24500-24850 for the first three day ahead of the RBI policy meet post the RBI meet index captured the 25000 mark and closed above it. This led to the formation of green candle, signaling resumption of uptrend.

• On expected lines, Nifty managed to hold 24500 and staged a strong rebound as 50 basis points cut in repo rate fueled the market momentum. The resumption of uptrend after shallow correction confirms that the bull market template is still intact. Nifty would challenge the upper band of consolidation placed at 25100 and open the door for next leg of up move towards 25500 in coming weeks. Volatility along the way if any should be used as a buying opportunity as we do not expect Nifty to breach key support of 24500 in coming week.

• Key thing to highlight is that, the index has staged a strong 15% rally from April lows. Post that, Nifty has been consolidating over past two weeks wherein it corrected 3%. The elongation of rallies followed by shallow retracement is a key ingredient of a structural bull market. Any decline should be used as buying opportunity.

• On the broader market front, outperformance was clearly reflected in the ratio chart of Nifty 500 / Nifty 100 that continued to inch northward. The current rally is backed by improvement in the market breadth as currently 55% stocks of Nifty 500 universe are trading above their long term 200 days SMA compared to a month back reading of 30% that augurs well for durability of ongoing up move.

• Key monitorable which would provide cushion to the ongoing up move:

• a. US and India Inflation data

• b. FII's inflow

• c. Further weakness in US Dollar index and Brent crude oil prices

• d. Bilateral Trade Agreement between India and US

• The index closed above 25000 mark which makes us revise our support base at 24500 as it is the consolidation of last three week and 50% retracement of recent rally (23935-25116).

Nifty Bank : 56578

Technical Outlook

Week that was :

• The Bank Nifty clocked a fresh All time high after 6 weeks hiatus . The index settled the week at 56 ,578 , up 1 .49 % . The Nifty Pvt Bank index underperformed the benchmark, and closed the week on a positive note at 27 ,832 , up 0 .93 %

Technical Outlook

• The index traded with range of 56161 -55400 until Thursday, the repo and CRR cut from rbi ignited rally in bank nifty which led the bank nifty to close above all -time high levels . The weekly price action formed a green candle, signaling resumption of uptrend . • Post RBI event Bank Nifty broke out from six weeks consolidation range indicating robust price structure . The implied target of the consolidation rage comes at 58800 . Meanwhile, strong support is placed at 55000 , which marks the 50 % retracement of the recent up -move (53 ,483 – 56 ,695 ) . Any, decline from current levels would offer incremental buying opportunities .

• Structurally, the Bank Nifty is witnessing an elongation of rallies followed by shallow retracements, signifying a robust price structure . The recent up -move of 14 % is stronger compared to the previous month’s 9 % rise . Additionally, the declines are becoming shallower, with the recent one being 4.6% versus 5.4% in March 2025. Furthermore, the index broke out of an eight -month falling trendline and surpassed its lifetime high, highlighting continued strength .

• The PSU Bank index outperformed the benchmark on a weekly basis and closed on a positive note . The index broke out from an eleven -month falling trendline on 19th May and, since then, has been forming a higher -high -low structure, indicating strong upside momentum . While the Bank Nifty is trading near its all -time high, the PSU Bank index is still trading ~13 % below its all -time high, presenting a compelling case for a catch -up move . Meanwhile, immediate support on the downside is placed at 6 ,700 , which is the 38 .20 % retracement of the rally from 7th April 2025 to 3rd June 2025 .

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