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Nifty :23618

Technical Outlook

Day that was.. Indian equity benchmarks ended the session on a minor negative note at 23,618, tracking muted global cues and a depreciating Indian Rupee, which hit a record low of 96.54 per US Dollar. Despite the flat headline index, market breadth remained positive with an A/D ratio of 2:1. Broader markets relatively outperformed the benchmark, as both the Nifty Midcap and Smallcap indices gained 1% each. Sectorally, major indices closed in the green led by a 3% surge in the beaten-down IT sector, while BFSI and Metals lagged behind.

Technical Outlook:

• The Index started the day on a positive note and faced selling pressure near its short-term resistance zone. near 23,800, a level marked by the 20-day EMA and a previous support breakdown, which is now acting as resistance under the change of polarity principle. Consequently, the daily price action formed a small bearish candle with an upper shadow, reflecting intraday profit-booking.

• Index is likely to witness gap down opening on back of weak global cues amid spike in US 30-yr yields which is at highest level since 2007. On a broader perspective, the Index is expected to consolidate within a wide range of 23,100-24,000, offering stock-specific opportunities. For a meaningful pullback to materialize, the Index must decisively cross and sustain above the psychological mark of 24,000. This level forms a strong confluence of the 50-day EMA, the 61.8% Fibonacci retracement, and last week’s high.

• On the sectoral front, the IT index has staged a sharp 6% recovery from its decade-long rising trendline support, indicating bounce from key support amid oversold conditions. Historically, since CY06, the IT index has witnessed a maximum price-wise correction of 35%, with time-wise corrections lasting between six and seven quarters. Currently, the index has corrected 42% in past 6 quarter and approached its long-term rising trendline. This alignment with the historical rhythm offers a highly favorable risk-reward setup at the current juncture.

• In the process, bouts of volatility cannot be ruled out amid ongoing geopolitical concerns, macro tailwind and Q4 earning seasons. Hence, one should focus on accumulating quality stocks backed by strong Q4 earnings as key support is placed at 23100 being 61.80% retracement of previous move (22182-24601) and the price gap support from 7th April 2026.

• Both the Nifty Midcap and Nifty Smallcap indices witnessed a strong recovery following a healthy bout of profit booking, with both indices undergoing a mean reversion toward their respective 20-day EMAs. During this process, market breadth experienced a minor deterioration over the fortnight; currently, 67% of stocks within the Nifty 500 universe are trading above their 50-day SMA, down from 72% two weeks ago. Meanwhile, the percentage of stocks trading above their 200-day SMA held steady at 40%, highlighting a broadening of the market rally that ultimately bodes well for the durability of the ongoing upward move.

Intraday Rational:

• Trend – Selling pressure near its short-term resistance zone near 23,800 being 20-day EMA

• Levels - Sell around 61.8% retracement of yesterday range

Nifty Bank : 53409

Technical Outlook

Day that was: The Bank Nifty Index the day on a marginally negative note at 53409 on back of mixed global cues. Nifty PSU Bank relatively outperformed, gaining 0.81%.

Technical Outlook:

• The index failed to capitalize initial gains and finally closed at days low. The daily price action resulted into small bear candle with higher high higher low indicating breather

• Index once again failed to close above previous session high. Going ahead, a decisive close above last sessions high (53770) is required to pause the ongoing corrective phase that would open the door for a pullback towards 20 days EMA that coincided with last week’s high of 55000. Failure to do so would result into prolongation of consolidation in 55000-52800 zone.

• The key support zone of 52800 is based on gap-area formed on 7th April and 61.8% retracement of entire April rally (49954-57456).

• Nifty PSU Bank is currently trading at crucial support zone of 7800 being placement of 52-week EMA coincided with April low of 7830. Thereby, holding 7800 level on a weekly closing basis is important to watch out for as that would help indexx to stage a recovery going ahead

• Intraday Rational:

• Trend- Trading below major key moving averages, indicating corrective bias

• Levels- Sell around 61.8% retracement of yesterday range

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