Nifty Sustains Bullish Tone; Dips Attract Renewed Buying

The Nifty index demonstrated impressive resilience on Monday despite heightened geopolitical tensions, maintaining its steady pattern of higher lows and higher highs —a hallmark of a bullish market structure. Although the index slipped 58 points to close at 25,227.35, it recovered swiftly from intraday lows, reflecting strong buying interest at lower levels.

This price action reinforces the market’s constructive undertone — as long as Nifty sustains above its previous breakout zone, dips are likely to attract renewed accumulation from traders and investors.

Technical Overview: Bullish Momentum Intact

Technically, Nifty remains well-positioned near its two-week high around 25,320, and a sustained follow-through buying could validate a clean breakout. The index continues to hover comfortably above its 10-day and 20-day Exponential Moving Averages (EMAs), both situated near 25,100, forming a strong demand base.

• Support Zone: 25,100 – 25,150 (Buy-on-dips pocket)
  
  
• Resistance Zone: 25,300 – 25,330
  
  

A decisive move above the 25,300–25,330 band could trigger a sharp short-covering rally, potentially extending the bullish momentum further.

Momentum indicators echo this view — the RSI (14) remains steady around 60, suggesting sustained strength within the ongoing uptrend. The area between 25,100 and 25,150 continues to act as a critical support cluster, aligned with key moving averages, while resistance remains capped near 25,300–25,330.

Derivatives Snapshot: Bulls Remain in Control

The derivatives data reinforces the strengthening bullish tone, with aggressive put writing outpacing call additions, a signal of trader confidence in near-term support levels.

• Major Resistance: 25,300 strike with 1.70 crore open interest
  
  
• Strong Support: 25,200 strike with 1.78 crore put OI buildup
  
  

Additionally, the migration of call positions to higher strikes, along with consistent put additions, indicates limited downside risk and a steady bullish bias.

The Put-Call Ratio (PCR) eased slightly to 1.02 from 1.40, pointing toward a balanced yet optimistic stance among traders expecting Nifty to sustain above its crucial support zones.

Volatility Check: Controlled Despite Global Concerns

The India VIX spiked 8.96% on Monday, marking a notable single-day rise. However, it continues to trade near historically low levels, signaling that market participants remain strategically cautious rather than panic-driven.

This subdued volatility environment reflects disciplined risk management and prudent hedging, even as geopolitical uncertainties persist globally.

Market Outlook: Buy-on-Dips Strategy Prevails

Despite the global overhang, Nifty’s swift recovery from lower levels and its sustained bullish structure highlight the market’s underlying strength. Strong put writing at near-the-money strikes reinforces persistent buying interest and confidence among traders.

Holding above short- and medium-term moving averages further supports the positive setup. A breakout above 25,300 could unleash a fresh round of short covering, potentially pushing the index toward 25,500 in the near term.

• Immediate Support: 25,150
  
  
• Crucial Zone: 25,000
  
  
• Upside Target: 25,500
  
  

Until a clear breakout is confirmed, a “buy-on-dips” approach remains prudent. Traders should focus on sustaining strength above 25,150 and look for confirmation beyond 25,300 to ride the next leg of the rally.

Key Takeaways

• Nifty remains resilient despite global uncertainty.
  
  
• Buy-on-dips strategy favored above 25,100 support.
  
  
• An RSI near 60 indicates sustained bullish momentum.
  
  
• Derivatives positioning signals limited downside risk.
  
  
• A breakout above 25,300 could trigger the next up-move toward 25,500.