Nifty Bank Holds Firm Near Breakout Zone; Bulls Eye Sustained Move Above 60,300

Market Recap

The Nifty Bank index continued to exhibit relative strength compared to the benchmark Nifty, ending the week on a firm note. The final trading session saw healthy bullish participation, enabling the index to close strongly near its key consolidation breakout zone. While this reflects improving sentiment among market participants, confirmation of a sustained breakout is still awaited.

Encouragingly, Nifty Bank managed to hold above the previous session’s low and traded comfortably above its 20-day Exponential Moving Average (EMA), which is now emerging as an immediate support level. This price behavior highlights underlying stability, with buying interest visible on minor declines. The index has also consistently defended the 59,000 demand zone, further strengthened by the rising 20-day EMA.

However, unless the index decisively sustains above the psychological 60,000 mark, which also coincides with a key breakout threshold, selling pressure could resurface at higher levels. Friday’s session was marked by a clear bullish bias, with buyers stepping in aggressively to defend intraday dips. The index gained nearly 1%, rising 515 points to close at 60,095.15. That said, the recent upmove remains largely supported by strength in PSU banking stocks, while broader participation is still evolving.

Technical View

From a technical perspective, Nifty Bank continues to attract buying interest on declines, especially around the 59,500 zone, a psychologically and technically important level. With prices hovering close to the breakout neckline, sustained follow-through buying is essential to validate the bullish setup.

Currently, the index is oscillating within a broad 59,500–60,200 range. A decisive move beyond either boundary is likely to define the next directional trend. Importantly, Nifty Bank remains above both its 20-day EMA (around 59,500) and 50-day EMA (near 58,900), lending strong near-term structural support.

On the upside, the 60,100–60,300 band, which coincides with the all-time high region, continues to act as a major resistance zone. Momentum indicators remain constructive, with the Relative Strength Index (RSI) hovering near 60, indicating a gradual revival in bullish momentum. A convincing breakout and sustained trade above 60,300 could attract fresh buying interest and strengthen the upward bias.

Derivatives Snapshot

The derivatives setup aligns with the bullish-to-sideways undertone seen in the cash market. Put writers have aggressively added fresh positions at at-the-money and nearby strikes, offering a cushion on the downside. Simultaneously, call writers have built positions at higher strikes, suggesting expectations of consolidation with limited immediate downside risk.

A significant open interest addition of nearly 20.33 lakh contracts at the 59,500 put strike highlights this level as a crucial near-term support. On the upside, an addition of around 15.62 lakh call contracts at the 60,000 strike reinforces it as a strong resistance ceiling. The Put–Call Ratio (PCR) has improved sharply to 1.05 from 0.89, signalling improving sentiment and growing confidence among put writers.

Market Outlook

Nifty Bank appears to have moved past its recent phase of sustained selling pressure. Quick rebounds from lower levels, coupled with improving momentum indicators, lend a positive undertone to the broader structure. However, muted participation from heavyweight private banking stocks—partly offset by strength in select PSU banks—has resulted in choppy and consolidative price action.

The index is currently hovering near the all-time high resistance zone of 60,300, which acts as an immediate ceiling, while the 59,000–58,800 band continues to form a strong support base. A breakout from either end of this range is likely to set the tone for the next meaningful directional move.

The 59,000 region remains particularly critical due to the confluence of technical and derivatives-based support. A failure to hold this zone could open the door for a deeper corrective phase. On the upside, a sustained and decisive move above 60,300 is essential to trigger renewed bullish momentum. Until such confirmation emerges, a buy-on-dips strategy is expected to dominate, with traders advised to remain selective and disciplined.

Looking ahead, market participants will closely monitor earnings from banking heavyweights such as HDFC Bank and ICICI Bank, which are expected to play a decisive role in shaping near-term sentiment. Additionally, global cues and any unexpected political developments, particularly involving Donald Trump, could add to volatility and influence market direction in the coming sessions.