NIFTY Bank Slips Into Corrective Phase as Sellers Dominate Late Trade

Market Recap: Heavy Liquidation Triggers Sharp Decline

Bank Nifty witnessed heightened volatility after heavy liquidation in both private and PSU banking counters triggered a sharp gap-down opening. The weak start set the tone for the session, with the index extending losses throughout the day before slipping into a narrow consolidation range in the latter half of trade.

The index eventually settled 553.10 points lower at 60,186.65, marking a strong bearish close. The decisive break below its immediate support zone has weakened the broader price structure and shifted the undertone toward caution.

Repeated pullbacks toward higher levels were consistently met with supply, highlighting sustained distribution pressure. The earlier base formation in the 60,500–60,700 band has now reversed its role and turned into a stiff resistance pocket. This zone aligns with multiple technical confluences, reinforcing it as a critical supply region for the bears.

Technical View: Sideways-to-Bearish Structure Emerges

Structurally, Bank Nifty has transitioned into a sideways-to-bearish setup, with sellers actively defending higher levels and converting intraday recoveries into fresh short positions.

Key technical observations:

• Breakdown Below Immediate Support: Reflects mounting distribution pressure.
• 20-Day EMA Confluence: The 60,100–60,000 zone aligns closely with the 20-day EMA, making it a decisive inflection region.
• RSI Near 50: The Relative Strength Index is hovering around the neutral mark, indicating fading bullish strength and a gradual tilt toward bearish bias.

The broader structure continues to favor a “sell on rise” strategy unless the index stages a decisive reclaim above 60,800. Only a sustained breakout beyond this level would negate the current bearish setup and revive upward momentum.

Derivatives Snapshot: Call Writing Caps Upside

Options data reflects a guarded near-term outlook:

• 60,500 Call Strike: Significant open interest build-up of ~9.82 lakh contracts, establishing it as strong resistance.
• 60,000 Put Strike: Addition of ~21.24 lakh contracts, reinforcing it as a near-term support base.
• Put–Call Ratio (PCR): Moderated to 0.87 from 1.09, signaling rising caution and growing dominance of call writers.

Aggressive call writing at at-the-money and nearby strikes is capping upside attempts, while put writers have shifted to lower strikes, indicating expectations of a lower trading band in the near term.

Market Outlook: 60,000 Becomes Make-or-Break Zone

Bank Nifty has now closed below its immediate support region, effectively converting it into resistance. The breakdown from its recent range, coupled with repeated rejection at higher levels, signals sustained selling pressure.

The index is hovering around the crucial 60,100–60,000 band:

• A sustained breach below 60,000 could trigger accelerated downside momentum and deepen the corrective phase.
• A decisive breakout above 60,800 is required to ignite meaningful short covering and restore bullish momentum.

Until buyers reclaim higher ground with conviction, intraday rebounds are likely to be viewed as opportunities to initiate fresh bearish positions. For now, the tactical stance remains aligned with a “sell on rise” approach.