The new week began on a slightly modest note. Although the day started with a significant gap-up, following the trend observed in recent sessions, buyers once again failed to sustain the initial advantage. Prices slipped below the early morning lows and eventually closed the morning gap. However, a mid-day recovery helped recoup some of the lost ground, enabling the index to settle at the 22555 mark, registering gains of 0.60%.

The technical setup remains unchanged and tentative, as no meaningful change was observed following the extended-weekend opening. That said, as highlighted in our previous market commentary, the possibility of a bounce in the coming sessions remains, given the presence of multiple technical supports at lower levels, particularly the 22200–22100 band. The price rejection witnessed during the previous trading session, as well as in the current session, underscores the presence of strong demand at lower levels. At the same time, the widening disparity between prices and key moving averages on both the weekly and daily charts also points towards the possibility of a mean-reversion move in the coming sessions. However, with the broader trend remaining firmly bearish across all time frames and the upcoming RBI policy adding an element of uncertainty, heightened volatility is likely to persist in the near term. In light of this, it would be prudent to avoid chasing the market on the upside for now. Instead, participants should look to utilise dips towards strong support levels to initiate selective, risk-managed positions. In terms of levels, the 22430-22400 band is an immediate support level, followed by a sacrosanct support in the 22200-22100 band. On the flip side the 22600-22650 band is an immediate hurdle, which is followed by a strong resistance at 22850-23000 band.

Key levels to watch

NIFTY

Support: 22430- 22400

Resistance: 22600- 22650

BANKNIFTY

Support: 54350– 54050

Resistance: 55200– 55300

Hitesh Rathi, Technical Analyst -Equity & Derivatives, Angel One.