Indian benchmark indices Sensex and Nifty closed higher for the second straight session. In a key milestone, Nifty closed above the 25,300 mark for the first time since July 11. Encouraging signals from India-US trade talks rekindled buying interest across sectors. The focus of market participants will now shift squarely to the US Federal Reserve’s policy outcome and outlook later tonight, with markets widely pricing in a 25-basis point rate cut.
Post the symmetrical triangle pattern breakout on the daily chart, Nifty has also negated the lower tops and lower bottom structure on the daily chart as the bulls further gained strength. The Index faced stiff resistance around the 25,340-25,350 zone multiple times on an Intraday basis but managed to close higher at 25,330, with a gain of 0.36%.
In the sectoral space, PSU Banks was the top performer of the day, closing with a strong gain of 2.61%, followed by Defence Index which closed nearly 2% higher. On the flip side, Nifty Metal and FMCG, ended in losses. Tata consumer and SBIN were the top gainers from the Nifty 50 pack while HDFC Life and Bajaj Finserv emerged as the top two losers.
Midcap 100 underperformed while the Smallcap 100 relatively outperformed the frontline indices. Midcap 100 and Smallcap 100 indices ended higher by 0.08% and 0.68%, respectively. The advance-decline ratio remained tilted in favour of the bulls with 284 stocks out of the Nifty 500 closing in the green, showing broad based buying rather than gains driven by just a few heavyweights.
Nifty View
Nifty continued its upward momentum today, closing near the 25,330 mark with a gain of around 91 points. Price action shows strong follow-up buying for the last few sessions, with today’s move building on the breakout seen above the previous swing high of 25,154, made on 21st August, yesterday.
Compared to the past few days, the index has not only sustained above key levels but is also pushing towards its earlier swing highs, showing renewed strength.
From a broader structure perspective, Nifty is now trading well above its 20-day, 50-day, 100-day, and 200-day EMAs, which signals a strong and improving trend. Momentum indicators are also supporting this rally with the RSI climbing well above 60, highlighting growing buying strength. The ADX is rising, with DI+ comfortably above DI–, indicating that the uptrend is gaining traction.
Looking at key levels, the 25,350–25,400 zone will act as an immediate resistance. A sustained move above 25,400 can lead to continuation of the up move in the Index towards 25,500 followed by 25,600. On the downside, the zone of 25,150-25,200 is likely to act as a support. Any throwback towards this zone can provide buying opportunities on dips.
Bank Nifty View
Bank Nifty closed the day at 55,493, adding over 346 points and extending its pullback rally. Unlike Nifty, the index has been recovering from a deeper corrective phase and a higher high formation in the last 6 trading sessions, shows strong follow-up buying interest. Price action suggests the index is trying to reverse its short-term weakness and build a stronger base.
On the technical front, Bank Nifty is trading above its 20-day and 50-day EMA, signalling an improving structure. Importantly, prices are now trading above the midline of Bollinger Bands, which indicates that the short-term trend has turned positive.
Momentum indicators are also turning supportive. The RSI has moved closer to 60, showing improving buying strength, while ADX indicates DI+ leading DI–, hinting that trend reversal is underway.
Looking at key levels, the 55,600–55,700 zone will act as an immediate resistance. A sustained move above 55,700 can lead to continuation of the up move in the Index towards 56,200. On the downside, the zone of 55,300-55,200 is likely to act as a support. Any throwback towards this zone can provide buying opportunities on dips.
