Nifty Bank Defends Crucial Floor Despite Lack of Momentum

Market Recap

The Nifty Bank index continued to trade with subdued momentum, spending most of the session in a narrow consolidation range. While decisive directional follow-through remained absent, the index once again demonstrated resilience by firmly defending its crucial support zone.

The gap support region, now acting as an immediate floor, continues to cushion declines and absorb supply. This steady defence of lower levels has gradually shifted the near-term bias in favour of the bulls. A well-defined base is forming in the 60,200–60,000 zone, which remains a critical line of defence for the ongoing uptrend.

Despite hovering close to the psychologically important 61,000 level, the index has managed to hold above its support base. A sustained move above this resistance could confirm follow-through buying. Structurally, the index continues to register higher lows while trading above key moving averages, indicating sustained accumulation at lower levels. A decisive breakout beyond 61,000 could trigger short covering and attract fresh buying interest, while holding above the 60,200–60,000 band remains essential to preserve a durable bullish structure.

The Tuesday session reflected a clear sideways tone. Trading largely within the previous day’s range, Nifty Bank protected its support zone, signalling active buying interest on intraday declines. The index closed marginally lower by 42.95 points at 60,626.40, though the broader setup continues to favour a buy-on-dips approach.

Technical View

From a technical standpoint, Nifty Bank appears to be in a continuation phase, marked by a healthy pause rather than exhaustion. The overall price structure points toward gradually improving bullish momentum, with corrective moves being consistently bought into.

A sustained move above 61,000 could inject fresh momentum into the ongoing uptrend. Importantly, the 60,300–60,000 zone, which earlier acted as a prominent supply area, has now transitioned into a key demand pocket.

This zone coincides with:

• The 0.382 Fibonacci retracement level
• Key short- and medium-term moving averages

This confluence makes it a critical inflection point for the index.

Momentum indicators remain supportive. The Relative Strength Index (RSI) is placed near the 60 mark, signalling a gradual strengthening of bullish momentum. A clean breakout above 61,000 could accelerate buying interest, while any corrective dips toward the 60,300–60,000 region are likely to be viewed as accumulation opportunities.

Derivatives Snapshot

Derivatives data reflects an improving and optimistic undertone. Put writers have added aggressive positions at out-of-the-money strikes, effectively cushioning the near-term downside. At the same time, call writers appear to be shifting positions to higher strikes, suggesting expectations of a range-bound market with a positive bias.

Key derivatives highlights:

• Open interest build-up of ~8.00 lakh contracts at the 61,000 call strike, marking it as a key resistance
• Addition of ~20.21 lakh put contracts at the 60,000 strike, reinforcing it as a strong immediate support
• Put–Call Ratio (PCR) stabilised near 1.00, reflecting sustained optimism and dominance of put writers

Overall, the derivatives setup suggests controlled consolidation with an upward bias, awaiting a breakout trigger.

Market Outlook

The Nifty Bank index is showing signs of bullish stabilisation amid a healthy consolidation phase, as it continues to trade firmly above its short-term moving averages and builds a solid base in the 60,300–60,200 zone. Despite recent gap-up openings, intraday declines are being swiftly absorbed, indicating renewed buying interest at lower levels.

A sustained follow-through above 61,000 could open the door for a sharper short-covering rally. On the downside, any pullback toward the 60,300–60,200 band is expected to attract strong buying interest and support further accumulation.

As long as these support levels remain intact, the buy-on-dips strategy is likely to remain favourable. Traders are advised to remain selective, disciplined, and cautious while navigating the evolving market structure.