Nifty Scales Nine-Week High as Fed Optimism Fuels Rally

The Nifty index surged to a fresh nine-week high, extending its winning streak on the back of optimism surrounding the U.S. Federal Reserve’s rate-cut decision. The index’s ability to sustain at elevated levels reflects a firm shift in the primary trend toward bullish territory. Notably, the consistent pattern of higher lows over the past three weeks underscores a robust technical structure and growing investor confidence.

Technical Picture: Breakout With Strength

Nifty opened with a gap-up and managed to hold onto its gains throughout the session. The index decisively pierced through immediate resistance levels that had long acted as hurdles—these have now flipped into strong supports. On the daily chart, this move marked a follow-through breakout above the previous swing high, a classic sign of trend confirmation.

The RSI remains steady above 66, signaling sustained bullish momentum. Any corrective dips from these levels are expected to attract fresh buying interest, turning pullbacks into accumulation opportunities.

Nifty gained 91.15 points to close at 25,330.25. On the downside, the 25,200–25,150 zone has emerged as a dependable demand base. On the upside, hurdles lie at 25,350 and 25,850, while 25,100 continues to serve as a strong floor.

Derivatives Snapshot: Optimism Persists

The derivatives setup mirrors the bullish sentiment.

• Heavy open interest buildup of 75.55 lakh contracts at the 25,500 strike highlights it as a strong resistance ceiling.
  
  
• On the flip side, the 25,200 strike holds the highest put OI of 77.01 lakh contracts, reaffirming its importance as a key support zone.
  
  
• Fresh put writing near current levels suggests limited conviction for sharp downside moves, while call writers shifting to higher strikes indicate confidence in further gains.
  
  

The Put-Call Ratio (PCR) eased to 1.16 from 1.30, reflecting a steady bullish undertone, though short consolidation phases may emerge as accumulation opportunities.

Volatility Check: Calm Confidence

The India VIX slipped 0.24% to 10.24, reflecting subdued volatility. Such muted readings suggest consolidation rather than panic-driven swings, signaling measured optimism as traders avoid aggressive hedging despite intraday fluctuations.

Market Outlook: Bulls in Control

The Nifty’s breakout above its swing high and its close at a nine-week peak solidify the case for continued upside momentum. With call writers shifting to higher strikes and put writers strengthening at-the-money support levels, the structure favors the bulls.

As long as the index sustains above the 25,100–25,150 range, buyers are likely to remain in control. On the higher side, a decisive close above 25,380 could set the stage for a move toward 25,500.

Adding fuel to the rally, FPI short-covering and reduced short exposure further boost sentiment. While minor profit booking after the Fed-driven rally cannot be ruled out, the broader outlook remains.