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If the Nifty 50 decisively breaks the 20-SMA (25,468) in the following session, bears are expected to gain further strength and may drive the benchmark index down toward the 25,300–25,200 zone (200-DMA/200-EMA) next week.
Analysts said the Nifty Bank continues to trade above its 20-day moving average near 59,700, which remains a key support.
If the NIfty 50 decisively breaks the previous day's low of 25,750, a fall toward 25,650–25,600 (20- and 100-day EMAs) can't be ruled out. However, in case of a rebound, the 25,900–26,000 range may remain a key resistance zone.
Experts expect some more consolidation, which is on expected lines after the recent rally, as long as the Nifty trades below the 26,000 zone. Immediate support is placed at 25,700–25,600, followed by 25,500 as the key support.
Weekly options data continued to suggest that 26,000 is expected to be immediate crucial resistance for the Nifty 50, with immediate support at 25,800.
Experts believe the ongoing consolidation is expected to end soon, and the Nifty 50 may gain strength for a move beyond 26,000 and target 26,200, until then, range-bound trading may continue as long as the index trades below 26,000.
The benchmark index needs to convincingly scale above the 26,000 zone for a move toward its record high. However, as long as the index stays below this level on a closing basis, consolidation with range-bound trading may continue.
The weekly options data indicated that 26,000 is expected to be a crucial resistance zone, which was tested intraday on Wednesday, with immediate support at 25,900.
The Nifty 50 is expected to continue its upward move toward the 26,000 zone, as sustaining above it can open the door for 26,200 and a record high. Until then, below 26,000, range-bound trading may continue with 25,800 acting as support, experts said.
Momentum indicators aligned with the rally. All key moving averages trended upward, and the index traded near the upper Bollinger Bands. Meanwhile, a falling VIX favoured bulls, signalling a healthy trend.
India VIX, the volatility index, declined by 4.31 percent to 11.67 and slipped below all key moving averages, signalling increased comfort for bulls. As long as the VIX sustains below the 12 zone, bulls are expected to remain in control.
Experts expect the Nifty 50 to march toward the psychological 26,000 level, followed by the 26,200 zone in the upcoming sessions, as long as it holds the 25,800 support.
Momentum indicators aligned with the rally, while the index sustained above all key moving averages. Hence, the benchmark index may rally toward the 26,000–26,200 levels in the upcoming sessions, provided it defends 25,780 (Monday’s low).
Weekly options data also suggested the next resistance for the Nifty 50 at the 26,000 mark, with immediate support at 25,800.
Bank Nifty: SBI shares were among the top gainers on benchmark indices Sensex and Nifty, as well the Nifty PSU Bank index which itself was up more than 3%.
Experts expect the Nifty 50 to march toward the 25,800–26,000 zone, with crucial support placed at 25,500–25,450, below which bears may come into strong action.
Technically, the Nifty 50 is expected to face strong resistance in the 25,800–26,000 zone, as only above this level is a major upmove toward the previous week’s high possible. However, on the lower side, 25,500 is expected to be a crucial support, experts said.
Traders should refrain from aggressive dip-buying in IT stocks and consider using rallies toward resistance as opportunities to sell until momentum improves, Sudeep Shah said.
The weekly options data signalled a 25,500–25,800 range for the upcoming sessions, while the broader range for the Nifty 50 is seen at 25,000–26,000.
While announcing the decisions taken during the MPC meeting, RBI Governor Sanjay Malhotra said that the central bank has decided to maintain status quo on the repo rate at 5.25% and retain stance at 'Neutral'.
The Bank Nifty remained in a better position than the Nifty 50. The banking index needs to defend the falling support trendline, as below it, 59,600–59,500 are the levels to watch. On the higher side, the hurdle is seen at 60,400, experts said.
As long as the Nifty 50 stays above 25,500–25,450 (key support), an upward move toward 25,800–26,000 is possible; however, a decisive fall below this level can open the door for 25,000, where the maximum Put open interest is placed, experts said.
Weekly options data suggested immediate resistance for the Nifty 50 at the 25,700–25,800 zone, with support at the 25,500 level, as a decisive break on either side can give a firm direction to the index.
Nifty Bank: The banking index had gained more than 3% in the past three sessions.
As long as these indices hold above the midline of the Bollinger Bands (20 DMA), the trend remains in favour of the bulls, with a continuation of the buy-on-dips strategy, experts said.
