Trading Plan: Will Nifty 50 hold 24,850, Bank Nifty stay above its August low?

Nifty Trading Plan for August 26

The Nifty 50 bounced back and closed higher but stayed within the previous day’s range on August 25. Until the index stays below 25,150, consolidation and rangebound trading may continue, with immediate support at 24,850. Below this level, bears may become strongly active and drive the index down to 24,700. Meanwhile, the Bank Nifty underperformed the benchmark Nifty 50. The index needs to get back above and sustain 55,800 for a move toward 56,160; until then, consolidation may remain, with 54,900 support (August low), as a break below this level may see bears take charge, according to experts.

On August 25, the Nifty 50 climbed 98 points to 24,968, while the Bank Nifty declined 10 points to 55,139. Market breadth was dominated by bears, as about 1,493 shares were under pressure compared to 1,298 advancing shares on the NSE.

Nifty Outlook and Strategy

Mehul Kothari, AVP - Technical Research at Anand Rathi Shares & Securities

Technically, Nifty has formed a bullish Harami candlestick pattern on the daily chart, supported by the 20- and 50-DEMA. The RSI remains above 50, reinforcing the positive momentum. Adding weight to the bullish case, the long-short ratio stood at only 11% (as of August 22), suggesting ample room for short covering to extend the rally.

Key Resistance: 25,000, 25,150

Key Support: 24,800, 24,700

Strategy: Buy Nifty Futures in the 25,000–24,900 zone, with a stop-loss of 24,750, targeting 25,350.

Shitij Gandhi, Senior Research Analyst (Technicals) at SMC Global Securities

Technically, Nifty has a strong support area in the zone of 24,800–24,700, while on the higher side, immediate resistance is placed at 25,150–25,160. A decisive breakout above this level could open the gates for a move towards 25,300–25,500 in the short term.

Technical momentum indicators remain rangebound, but the overall bias is slightly tilted in favour of the bulls.

Key Resistance: 25,100, 25,300

Key Support: 24,800, 24,700

Strategy: Buy Nifty Futures on dips near 24,850, with a stop-loss below 24,700, targeting 25,150.

Bank Nifty - Outlook and Positioning

Mehul Kothari, AVP - Technical Research at Anand Rathi Shares & Securities

In the current setup, the Bank Nifty index has formed a Doji pattern exactly at the 100-DEMA, reflecting a state of indecision. However, the hourly chart presents a bullish BAT pattern, signalling potential upside in the sessions ahead. Supporting this view, the RSI on the hourly chart has staged a sharp V-shaped (also known as an impulsive structure) recovery, further strengthening the positive bias. Overall, signals suggest a constructive near-term outlook for Bank Nifty despite the day’s muted action.

Key Resistance: 55,500, 55,800

Key Support: 55,000, 54,800

Strategy: Buy Bank Nifty Futures in the 55,250–55,000 zone, with a stop-loss of 54,700, targeting 55,800.

Shitij Gandhi, Senior Research Analyst (Technicals) at SMC Global Securities

The banking index, on the flip side, began the week on a negative note. As the new week unfolds, technical charts suggest rangebound but volatile trade, with critical support and resistance levels guiding the near-term trajectory. Crucial support is seen at the 55,000 level for the index, while a breakdown below could accelerate declines towards the 54,400–54,200 zone. On the upside, the 55,600–56,150 zone is likely to act as a stiff hurdle, with traders likely to adopt a sell-on-rise strategy.

Key Resistance: 55,600, 56,100

Key Support: 55,000, 54,500

Strategy: Sell Bank Nifty Futures below 55,000, with a stop-loss above 55,600, targeting 54,100.

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