Nifty Bank Loses Momentum; Failure to Reclaim 54,200 Keeps Downside Risks Alive

Nifty Bank once again failed to sustain recovery, erasing previous session gains and slipping deeper into weakness as private banks led the drag. On Tuesday, the index dropped 341.45 points to close at 53,661.00, holding just above the crucial psychological support of 53,500—a zone that also aligns with its 200-day EMA and recent swing low.

Key Technical Highlights

• Resistance Zone: The 54,000–54,200 band has emerged as a strong supply region. This zone coincides with short-term moving averages, creating a ceiling for any rebound attempts.
  
  
• Support Zone: The 53,500 level remains critical, with a breach opening the door for further downside toward 53,000.
  
  
• Momentum: The daily RSI near 40 reflects weak momentum, keeping bullish conviction subdued.
  
  

📌 Takeaway: Unless Nifty Bank reclaims 54,200 decisively, the index remains vulnerable to extended weakness.

Derivatives Snapshot

The F&O setup paints a cautious picture:

• Call Writing: Heavy positions at the 54,000 strike (12.89 lakh OI) reinforce stiff resistance.
  
  
• Put Writing: The 53,000 strike holds the highest put open interest (8.17 lakh contracts), making it immediate support.
  
  
• PCR (Put-Call Ratio): Stable at 0.83, reflecting persistent supply pressure and a largely neutral undertone.
  
  

Fresh call writing close to spot levels suggests traders lack confidence in a sustained upside, while aggressive put activity indicates hedging around key supports.

Market Sentiment & Outlook

Nifty Bank continues to underperform, struggling against overhead resistances and stuck in volatile intraday swings. The index’s inability to sustain higher levels has tilted the structure toward weakness.

• Bullish trigger: Only a decisive close above 54,200 can revive momentum.
  
  
• Bearish risk: A breakdown below 53,500 could extend declines toward 53,000.
  
  

For now, the stance remains sell-on-rise, with short-lived pullbacks likely to attract selling pressure rather than signal a meaningful trend reversal.