Nifty Holds Above Key Support; Bank Nifty Shows Consolidation Near Highs

The benchmark indices witnessed a muted session as the market continued to digest the recent decline. While Nifty managed to hold above crucial support levels, Bank Nifty remained range-bound, indicating a phase of consolidation rather than directional weakness.

The broader technical structure remains intact, but momentum indicators suggest a cautious near-term outlook.

Nifty Technical Outlook: Weak Momentum but Key Support Intact

Nifty ended the session at 25,482.50, gaining 0.23%. The index formed a bearish candle with a long upper wick, reflecting selling pressure at higher levels and lack of strong follow-through buying after the previous sharp decline.

Key Observations

• The index oscillated around the 25,500 zone, indicating indecision.
• Nifty is trading below the 20-day and 50-day SMAs, suggesting short-term weakness.
• However, it continues to hold above the 200-day SMA, keeping the broader trend intact.
• Price action is currently positioned between the 38.2% and 50% Fibonacci retracement levels.
• The index is moving between the middle and upper bands of the Donchian channel, indicating a consolidation phase rather than a breakdown.

Momentum Indicators

• MACD remains in negative territory.
• RSI near 46 signals weak-to-neutral momentum.
• India VIX declined to 13.49 (-4.66%), indicating reduced volatility and absence of panic selling.

Key Levels to Watch

Support

• 25,400 (Immediate)
• 25,300 (Next)

Resistance

• 25,620 (Crucial near-term barrier)

A sustained close above 25,620 would be required to shift short-term control back in favor of buyers. Until then, the index may continue to trade in a consolidation range.

Bank Nifty Outlook: Consolidation Within a Strong Trend

Bank Nifty closed at 61,043.35, marginally lower by 0.01%, and continued to hover near the upper end of its recent range.

The index has now spent multiple sessions below the 61,600 level, indicating hesitation near the recent swing high rather than fresh upward expansion.

Technical Structure

• Daily candles are overlapping with smaller bodies, a classic sign of consolidation after a strong rally.
• Bank Nifty continues to trade above the 20-day moving average.
• It also remains comfortably above the 50-day average near 59,800, keeping the broader bullish structure intact.

Momentum Indicators

• MACD remains in positive territory.
• RSI near 57 suggests moderate bullish momentum, though not accelerating.

Key Levels to Watch

Support

• 60,700 (Immediate)
• 60,400 (Next)

Resistance

• 61,600 (Key breakout level)

A decisive close above 61,600 is required for the index to resume directional expansion toward fresh highs. Until then, Bank Nifty is likely to remain in a consolidation phase within a strong broader uptrend.

Market View: Consolidation Phase with Stock-Specific Opportunities

The current price action across indices suggests:

• Short-term consolidation after recent volatility
• No major breakdown in broader market structure
• Cooling momentum rather than trend reversal
• Potential for range-bound trading in the near term

With volatility declining and key supports holding, the market appears to be stabilizing. Traders may focus on breakout levels (25,620 for Nifty and 61,600 for Bank Nifty) for the next directional move.