Tariff Easing and India–US Deal Spark Sharp Gains in Nifty and Nifty Bank

Indian equity markets witnessed a strong relief rally as tariff easing under the India–US trade deal lifted investor sentiment, triggering a sharp gap-up opening in benchmark indices. Both Nifty 50 and Nifty Bank ended the session with solid gains, though intraday volatility remained elevated as profit booking emerged at higher levels.

Nifty 50: Gap-Up Rally Meets Profit Booking at Higher Levels

The Nifty 50 opened sharply higher at 26,308.05, reacting positively to developments around the India–US trade agreement. The index quickly moved to an intraday high of 26,341.20, but failed to sustain higher levels and witnessed steady selling pressure through the session.

Nifty slipped to an intraday low of 25,641.30 before settling at 25,727.55, registering a gain of 2.55% for the day.

Technical View

• The index formed a large daily candle, indicating strong participation, though the long intraday retracement highlights selling pressure at higher levels
• Nifty has reclaimed all major moving averages, a positive technical development
• However, it slipped below the Supertrend level near 25,850, suggesting the recovery has not yet matured into a sustained uptrend

Momentum & Volatility Indicators

• RSI rebounded sharply and moved above 50, indicating improving momentum
• DMI setup shows the positive directional line gaining strength
• Market breadth improved, with the advance–decline ratio remaining favourable
• India VIX declined nearly 7% to 12.89, reflecting easing volatility after recent spikes
• A sharp fall in USDINR below 90.50 further supported overall market sentiment

Key Levels to Watch

• Immediate support: 25,500, followed by 25,400
• Resistance: 25,900, followed by the psychological 26,000 level

Despite the strong close, sharp intraday swings suggest volatility may remain elevated, with two-sided moves likely in the near term.

Nifty Bank: Near Record Highs but Faces Resistance

Nifty Bank also opened with a strong gap-up, tracking positive cues from the India–US trade deal. The index opened at 61,411.20 and surged to a fresh all-time high of 61,764.85 in early trade.

However, profit booking emerged at record levels, dragging the index down to an intraday low of 59,793.20. Nifty Bank finally settled at 60,041.30, ending the session 2.43% higher.

Technical View

• The daily chart shows a large candle with a long upper shadow, highlighting supply pressure near record highs
• Despite the pullback, the index continues to hold above all key moving averages, keeping the broader trend intact

Momentum Indicators

• RSI is placed near 56, indicating a recovery from recent weakness
• DMI setup remains positive, with the positive directional line above the negative line and improving trend strength

Banking Sector Participation

• Nifty PSU Bank index gained 2.65%
• Nifty Private Bank index rose 2.50%
• The move reflects broad-based participation across the banking space

Key Levels to Watch

• Immediate support: 59,600, followed by 59,400
• Resistance: 60,437 (earlier 52-week high), followed by 60,500

With Nifty Bank hovering near record levels, resistance zones are likely to determine the next directional move.

Market Outlook

The India–US trade deal and tariff easing have clearly acted as strong short-term triggers, helping markets recover sharply. However, selling pressure at higher levels and sharp intraday swings indicate that volatility may persist.

For the rally to sustain, markets will need:

• Follow-through buying
• Fresh long build-up
• Stability above key resistance zones

Until then, range-bound action with heightened volatility is likely in the near term.