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Nifty :23914

Technical Outlook

Day that was.. Equity benchmark concluded monthly expiry session on a subdued note tracking mixed global cues wherein Nifty lost 100 points to settle the Tuesday’s session at 23940. Defying the global volatility, midcap index gained 0.5% and clocked a fresh all-time highs. Sectorally, metal outshone while consumer durables, realty, PSU Banks remained laggards

Technical Outlook:

• The index taken a breather after last sessions sharp up move as it failed to capitalized the initial up move and gradually drifted downward throughout the session. Consequently, daily price action resulted into small bear candle with long upper shadow, highlighting temporary breather

• Index likely to open on a negative note tracking mix global cues amid geopolitical uncertanity. Tuesday’s retracement is viewed as a healthy pause following a two-session rally rather than a trend reversal. We reiterate our positive stance and expect the Nifty to gradually head toward the 24,500 level in the coming weeks. This target aligns with the multiple swing highs recorded on April 21 and May 7, 2026. In the process, intermittent bouts of volatility cannot be ruled out wherein Nifty can retest immediate breakout zone near 23,800.

• Structurally, index is undergoing slower pace of retracement wherein over past five weeks it has retraced merely 50% of preceding 3 weeks 11% rally, highlighting healthy consolidation that sets a strong foundation for next leg of up move. Hence, investors should utilize this volatility to accumulate quality stocks backed by strong earnings growth.

• Underscoring the structural strength, technical support has now been revised upward to 23,400, which represents a crucial 80% retracement of the current up-move (23,262–24,038) and aligns with the recent swing low formed on 20th May 2026.

• Broad-market indices continue to validate the bullish sector rotation. Following a three-week consolidation phase, the Nifty Midcap index has successfully resumed its upward trajectory to register new historic highs. Concurrently, the Smallcap index has revived its upward trend after forming a higher base near its 52-week EMA, yet 8% way from All-time High. Hence, we expect catch up activity in the small cap space as the market breadth continues to improve. The reading of % of stocks above 50- and 200-days SMA has improved to 73% and 47% compared to 68% and 43% respectively.

Key Monitorable:

• Adding a structural tailwind to Indian equities, Brent crude oil has broken down below its one-month rising trendline support. This accelerating decline in global crude prices is highly beneficial for a major importing nation like India.

• The pair of USD/INR retreated from the extreme overbought reading on Monthly RIS of 84 (highest since 2002). Further, Gravestone Doji candle on the weekly chart signifies, potential trend exhaustion and an impending reversal in favor of the Rupee.

• US and India GDP data

Intraday Rational:

• Trend – Breather after two-session up move, highlighting temporary breather

• Levels - Buy around 80% retracement of 3 days range

Nifty Bank : 55093

Day that was: Bank Nifty Index closed monthly expiry, marginally negative note at 55093 down 0.2% on back of mixed global cues. Nifty PSU Bank relatively underperformed losing 0.4%.

Technical Outlook:

• Index failed to sustain above opening highs and thereafter found supportive efforts emerging from 61.8% retracement of previous day up move. The daily price action resulted into high wave candle with higher high higher low indicating breather after rally.

• Key point to highlight is that, after two days up move index took breather neat its 50-day EMA. Despite breather Index maintained its higher high higher low indicating positive momentum in near term. Going ahead, we expect index to head towards 56500 being 80% retracement of recent decline

• Improvement in structure makes us revise support at 53800 being 61.8% retracement of current rally (52780-55405)

• Nifty PSU Bank maintained higher high higher low formation and close near its 200-day EMA. We expect Index to hold 7800 levels and gradually head towards sustainability above 8100 mark will lead Index towards 8600 levels being 61.8% retracement of current decline(9095-7800)

Intraday Rational:

• Trend- Higher high-low formation in daily time frame while basing in the vicinity of 50-day EMA, indicating bias remains positive

• Levels- Buy around 80% retracement of 3 days range

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