Nifty Recovers Smartly from Lower Zone, Reasserting Short-Term Strength

Market Overview

The Nifty index recovered sharply from intraday lows to close higher at 25,694.95, gaining 0.47% after a volatile trading session. Despite early weakness, strong buying at lower levels helped the index close near the day’s high. On the daily chart, Nifty formed a bullish candle with a long lower shadow, signalling renewed confidence among market participants and strong demand at dips.

The index has reclaimed the middle Bollinger Band near 25,680, a sign of stability returning after recent corrections. This rebound also reinforces the broader higher-high and higher-low structure, suggesting that the underlying uptrend remains intact.

Technical Outlook: Nifty

Momentum Indicators Turning Positive

Momentum indicators are showing early signs of recovery:

• The RSI (14) is placed near 56, highlighting improving strength.
  
  
• The MACD continues to narrow its negative spread, signaling a loss of downside traction and the potential for further upside.
  
  

Support has now shifted higher to 25,500, while resistance is seen around 25,880–25,950. Sustaining above 25,720 could open the door to a move toward the upper Bollinger Band, whereas holding above 25,500 will maintain the short-term positive stance.

For now, a buy-on-dips strategy remains favourable within the broader range of 25,500–25,950 as long as Nifty continues to form higher lows on the daily timeframe.

Nifty Bank: Consolidation Within Flag Formation

The Nifty Bank index also ended higher at 58,138.15, up 0.35%, after a subdued start that gradually strengthened during the session. The index formed a modest bullish candle, continuing to oscillate within a flag pattern, suggesting an ongoing consolidation phase following the recent upmove.

Key Technical Levels

• Support Zone: 57,800–57,700
  
  
• Immediate Resistance: 58,340
  
  
• Primary Resistance: 58,577.50 (All-time high)
  
  

The index continues to hold above its short-term average near 57,850, providing a cushion for buyers. On the hourly chart, the trend remains bullish, supported by improving momentum. The RSI at 63 reflects a positive bias, while the MACD shows steady recovery with a narrowing gap from its signal line.

As long as Nifty Bank sustains above 57,700, the short-term tone remains constructive, with potential for a gradual extension of gains in upcoming sessions. A break above 58,340 could trigger a rally toward the record high of 58,577.50.

Market Outlook

The broader market setup suggests that buyers have regained control at lower levels, reinforcing the short-term bullish outlook for both Nifty and Nifty Bank.

• For Nifty: Watch for sustainability above 25,720 for continuation toward 25,950.
  
  
• For Nifty Bank: Holding above 57,700 keeps the tone positive, with potential upside toward 58,600.
  
  

Traders can continue to adopt a buy-on-dips approach, focusing on stock-specific opportunities within the banking, auto, and FMCG sectors as momentum gradually returns to the broader indices.