Technical View: Nifty gains for 6 days, but must sustain above 25,000 to break lower high–lower low pattern

Nifty Outlook for September 11

The Nifty 50 staged a healthy performance and touched the psychological 25,000 mark for the first time since August 22, extending its northward move for the sixth consecutive session on September 10. Momentum indicators also gained strength, with consistent bullish crossovers in RSI, MACD, Stochastic RSI, and the histogram.

Now, the index must give a decisive and sustainable close above 25,000 for a further sharp upmove toward the 25,200–25,250 range and to negate the lower highs–lower lows structure. Additionally, the index closed exactly at the downward-sloping resistance trendline. Surpassing this resistance could further strengthen the market. On the downside, the 24,900–24,800 zone can act as immediate support, followed by 24,750 as a key support level, according to experts.

The Nifty 50 opened more than 100 points higher and stayed above 24,900 throughout the session, as well as above all key moving averages. The index surpassed 25,000 and touched an intraday high of 25,036 before closing at 24,973, up 105 points. It formed a small bearish candle with upper and lower shadows on the daily timeframe, indicating a high-wave candlestick pattern, which signals volatility and indecision among bulls and bears.

The 10- and 20-day EMAs trended upward, with a slight expansion in the upper band of the Bollinger Bands.

"Momentum indicators and oscillators have also given a bullish crossover on the daily chart, signaling positive sentiment. Going forward, the Nifty could gradually move towards the 25,200–25,500 range, with immediate support placed around the 24,800 level," said Nilesh Jain, Head – Technical and Derivatives Research Analyst (Equity Research) at Centrum Broking.

Derivatives Update

The weekly options data also suggest that 25,000 is crucial for further upward direction, as it will open the door for 25,200 and 25,500, with support at 24,900–24,800.

Maximum Call open interest was observed at the 25,000 strike, followed by the 25,500 and 25,200 strikes, with maximum Call writing at the 25,000, 25,100, and 25,200 strikes. On the Put side, the 25,000 strike holds the maximum Put open interest, followed by the 24,900 and 24,800 strikes, with maximum Put writing at the 25,000, 24,950, and 24,900 strikes.

Bank Nifty

The Bank Nifty also continued its upward journey for the sixth consecutive session, holding 54,000 strongly for a week now and closing at 54,536, up 320 points. The index formed a Doji candlestick pattern on the daily charts, indicating indecision. It could not sustain above the midline of the Bollinger Bands and the 20-day EMA but finally gave a strong close above the 10-day EMA after four days of struggle, which is positive.

On the derivatives side, short covering across strikes from 54,000–54,500 supported sentiment. Looking ahead, the 54,300–54,200 zone will act as crucial support. A sustained move below 54,200 could trigger a decline towards 53,800, followed by 53,400 in the short term, said Sudeep Shah, Head - Technical Research and Derivatives at SBI Securities.

On the upside, the 54,700–54,800 zone will serve as key resistance, he added.

Meanwhile, the India VIX fell further by 1.38 percent to 10.54, its lowest closing level since July 23 — a seven-week low — signaling more comfort for bulls and less volatility in the near term.

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