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The Indian stock market, as represented by the Nifty 50 and Bank Nifty indices, exhibited signs of resilience and a potential for consolidation in the near term, according to a recent analysis. Following a period of weakness, both indices demonstrated a notable recovery, climbing nearly 1 percent on May 23. However, the overall trend suggests a rangebound movement for the Nifty 50, particularly as long as it remains below the 25,116 level. Crossing this threshold could propel the index towards the 25,200–25,300 zone. On the downside, the immediate support lies at 24,700. A breach of this support could trigger a further decline, potentially dragging the index towards the 24,460 mark. The Bank Nifty, on the other hand, faces a crucial juncture at the 54,550 zone. Maintaining support at this level could pave the way for a rally towards 55,700–56,000 in the upcoming sessions. Conversely, a failure to hold this level could invite significant selling pressure, according to market experts. On May 23, the Nifty 50 closed at 24,853, a gain of 243 points or 1 percent, while the Bank Nifty surged by 457 points or 0.83 percent to reach 55,398. The market breadth favored the bulls, with approximately 1,580 shares advancing against 977 declining on the National Stock Exchange (NSE). Rajesh Bhosale, a Technical Analyst at Angel One, highlighted that the week leading up to the analysis was characterized by consolidation. Given the overbought conditions, the Nifty struggled to attract substantial buying interest beyond the 25,000 psychological level. Nevertheless, the broader uptrend remains intact, as key support levels were respected. This resulted in a small-bodied candle with a lower shadow on the weekly chart, indicating buying interest at lower levels. Bhosale anticipates that consolidation may persist in the near term. He pointed out a double bottom formation on the hourly chart near 24,500, which coincides with the 20-day Exponential Moving Average (DEMA), making it a crucial support zone. The primary uptrend is likely to resume only after a sustained move above 25,000. Until then, a "buy on dips and sell on rise" strategy remains appropriate. While key indices remained rangebound, thematic plays continued to outperform. Therefore, traders and investors are advised to focus on such pockets for potential outperformance. Bhosale identified key resistance levels at 25,000 and 25,100, and key support levels at 24,650 and 24,500. He suggests buying Nifty Futures on dips around 24,700, with a stop-loss at 24,570, targeting 25,000 / 25,100. Rajesh Palviya, Senior Vice President Research (Head Technical Derivatives) at Axis Securities, noted that the Nifty 50 settled 167 points lower for the week ended May 23. The index is now approaching a critical resistance zone at 25,000–25,200. A sustained breakout above this zone could unlock further upside potential. Conversely, a decisive close below the lows of the past two weeks, around 24,400, may trigger fresh profit booking. According to Palviya, a sustained move above 25,000 may lift Nifty to 25,200–25,500, while a break below 24,600 could drag it down to 24,400–24,200. He expects Nifty to trade within the 25,500–24,200 range with a mixed bias. Momentum indicators remain cautious—weekly RSI is nearing a bearish crossover, and Stochastic has turned negative from overbought levels, hinting at possible consolidation or profit booking. Palviya identified key resistance levels at 25,000, 25,150, and 25,350, and key support levels at 24,800 and 24,700. He recommends buying Nifty Futures around 24,725 with a stop-loss around 24,600, targeting 24,950–25,100. Anshul Jain, Head of Research at Lakshmishree Investments, observed that Nifty wrapped the week with a Hammer candle, signaling bullish intent after defending the fair value area high of 24,589. However, the candle also forms an inside bar relative to the previous week, suggesting consolidation. For a clear directional move, the index must break and sustain above 25,063. A decisive move past this level could trigger a rally toward 25,847—the next key resistance marked by a weekly order block. On the downside, immediate supports are seen at 24,736 and 24,584. Technically, both the 10-day and 20-day EMAs are well-aligned to fuel an upward breakout. Until a clean breach of 25,063 occurs, expect a tight range. The setup is ripe, but confirmation is key for trend continuation. Jain identified key resistance levels at 25,063 and 25,250, and key support levels at 24,736 and 24,584. He suggests buying Nifty Futures on breakout above 25,063 or on dips to 24,736, with a stop-loss below 24,650, targeting 25,250.
The analysis of the Bank Nifty index echoes a similar sentiment of consolidation and potential breakout scenarios. Rajesh Bhosale from Angel One noted that the Bank Nifty continued to oscillate within its prior 9-day range, with no significant changes in the technical setup. His bias remains unchanged: unless there is a breakout above the immediate resistance zone of 55,550–55,600 or a breakdown below the support band of 54,600–54,500, momentum acceleration remains unlikely. Prices are expected to remain rangebound. That said, the index has repeatedly found support in the 54,600–54,500 zone, which aligns with the 20DEMA, indicating a slight bullish tilt and increasing the likelihood of a potential breakout in the coming week. If such a breakout occurs, the index could initially move past 56,000, with further gains likely beyond that level. Bhosale identified key resistance levels at 56,000 and 56,200, and key support levels at 55,000 and 54,600. He suggests buying Bank Nifty Futures on dips around 55,000, with a stop-loss of 54,600, targeting 56,000 / 56,200. Rajesh Palviya from Axis Securities pointed out that the Bank Nifty ended the week with a modest gain of 43 points. On the weekly chart, a Doji candlestick has formed, signaling indecision among market participants. Despite this uncertainty, the index remains within a bullish flag pattern, indicating a consolidation phase within a larger uptrend. A decisive breakout above this pattern would confirm a continuation of the rally, while failure to do so may extend the consolidation phase. Technically, a move above 55,500 could take Bank Nifty to 56,000–56,500, while a break below 55,000 may drag it down to 54,500–54,000. For the week ahead, the Bank Nifty is expected to trade within the broader range of 56,500 to 54,000, with a mixed bias. Momentum indicators like the RSI and Stochastic Oscillator have flattened, reinforcing the current lack of directional strength. Palviya identified key resistance levels at 55,600 and 55,900, and key support levels at 55,000 and 54,700. He recommends buying Bank Nifty Futures near 55,100, with a stop-loss of 54,900, targeting 55,650–55,800. Anshul Jain from Lakshmishree Investments noted that Bank Nifty has spent five weeks in broad consolidation, with price action tightening yet remaining rangebound. While not ultra-compressed, the structure reflects underlying accumulation. A failed breakdown within this range further strengthens the case for an imminent breakout. A decisive move above 56,000 will confirm bullish intent, likely attracting aggressive long positions. With the 10- and 20-day EMAs aligned as momentum drivers, there’s little overhead resistance to stall the rally. Post-breakout, bulls could target the 58,000 mark. On the downside, the swing low at 54,576 is a crucial support—any meaningful dip must hold above this level to retain the bullish bias. The stage is set, but confirmation is key. Jain identified key resistance levels at 55,695 and 56,000, and key support levels at 54,576 and 54,442. He suggests buying Bank Nifty Futures on breakout above 55,695, with a stop-loss below 55,400, targeting 56,000 / 56,250.
In summary, the Nifty 50 and Bank Nifty indices are showing signs of consolidation with potential breakout opportunities. Various technical analysts suggest specific entry and exit points for futures trading, emphasizing the importance of stop-loss orders to manage risk. The overall sentiment leans towards a cautious bullish outlook, contingent upon breaking key resistance levels and holding crucial support levels. Market participants are advised to monitor these levels closely and consider thematic plays for potential outperformance. The disclaimer highlights that the views expressed are those of the experts and not the website, advising users to consult certified experts before making any investment decisions. The convergence of expert opinions suggests a cautious approach, acknowledging the rangebound nature of the market while identifying potential trading opportunities based on specific price levels and technical indicators. The strategies involve buying on dips or breakouts, with defined stop-loss levels to mitigate downside risk. The recommendations are based on technical analysis, including support and resistance levels, candlestick patterns, and moving averages. However, the market is dynamic, and actual outcomes may vary. Therefore, careful consideration of risk tolerance and market conditions is crucial before implementing these strategies. The experts also caution that the market may remain volatile and that any news that could impact trading of the stocks should be taken into account, as well. Overall, the information presented in the article can be taken as a good starting point for the average investor who wishes to use technical analysis to analyze stocks. Of course, they are encouraged to seek further opinions, but the information can act as a jumping off point for better understanding the complexities of the market. Furthermore, the overall sentiment of the experts can be taken as an indication for how the market might perform, but investors should ultimately do their own research before making a decision. Investing in stocks can be risky, but with proper education and experience, investors may be able to better manage their risk. The insights and suggestions mentioned in this article act as a good first step for further learning and can result in successful returns for those who have the patience to understand how the market works. By carefully analyzing the data presented, investors may be able to make better decisions and manage their risk. This in turn, will likely lead to successful investments. The tips and suggestions that are written should not be taken as absolute truth, but rather as a first step to a more informed investment decision.
It is also worth noting that the strategies outlined by the experts often depend on specific levels being tested. For instance, Anshul Jain suggests buying Bank Nifty Futures on a breakout above 55,695, while Rajesh Bhosale recommends buying them on dips around 55,000. These differing approaches reflect the inherent uncertainty of market predictions, as well as the need for investors to choose strategies that align with their risk tolerance and trading style. Some investors may prefer to wait for confirmation of a breakout before entering a position, while others may be more comfortable buying on dips in anticipation of a reversal. The most important aspect of all the strategies is to utilize a stop-loss, a safety measure that helps to prevent too much loss for the investor. As a result, it is often emphasized by the experts in order to ensure that an investor makes a decision with caution and an understanding of the risks involved. In the event that they are wrong, they must be able to limit the amount of damage that can occur. Furthermore, investors should consider their holding period and whether they are pursuing long-term or short-term investments. It is worth noting that all of the experts advise against a long-term strategy due to the volatility and uncertainty of the current market. Therefore, as it is now, investors would benefit more from a short-term strategy to avoid too much loss. With a long-term strategy, investors are bound to take losses because the market will inevitably go through changes and may not stay consistent for a long period of time. As such, it is better to monitor and evaluate constantly and be ready to cut losses when the time calls for it. By taking all these factors into consideration, investors can gain a more complete understanding of the market landscape and make more informed decisions. Investors should remember that the market is dynamic and unpredictable, so all investors must proceed with caution.
Finally, the mention of thematic plays, as advocated by Rajesh Bhosale, highlights the importance of identifying sectors or industries that are poised for growth. While the major indices may remain rangebound, certain sectors may offer better opportunities for outperformance. This approach requires investors to conduct thorough research and identify companies with strong fundamentals and growth potential. Furthermore, it is important to note that external factors, such as economic conditions and government policies, can significantly impact the market. For instance, changes in interest rates, inflation, or trade policies can influence investor sentiment and market volatility. As a result, investors should stay informed about macroeconomic trends and regulatory developments to make more informed decisions. The final point to be reiterated is that the analysis presented in the article should not be considered investment advice. The strategies and recommendations are based on the experts' opinions and technical analysis, but they are not guarantees of success. Investors should always conduct their own research, consider their risk tolerance, and consult with a qualified financial advisor before making any investment decisions. In conclusion, the analysis of the Nifty 50 and Bank Nifty indices suggests a cautious outlook with potential breakout opportunities. The experts recommend specific strategies for futures trading, emphasizing the importance of stop-loss orders and thematic plays. Investors should carefully consider their risk tolerance, conduct thorough research, and stay informed about macroeconomic trends and regulatory developments. By following these guidelines, investors can increase their chances of success in the dynamic and unpredictable stock market. As the market continues to change, it will be even more important for investors to do their own research and stay informed to continue managing risk. With a volatile market, investors should be ready to make changes to their strategy and constantly adapt to the changes. It is important to stay updated and be ready to cut losses so that investments are not heavily impacted by changes in the market. The market is ever-changing and only those who continue to stay informed and adapt will succeed.
As such, investors should read opinions and articles with caution to ensure that they are making a decision that best reflects their risk tolerance and comfortability. By researching and making informed decisions, investors can ensure that they will not regret their decisions, whether or not their efforts were successful or resulted in a loss. While it is a painful experience to suffer a loss, it is even more painful to suffer a loss because of not enough research, or being tricked into making a risky investment. As a result, the most important point for investors to remember is to be cautious when investing and be prepared to make changes and cut losses, while being informed and making decisions that are most appropriate for themselves. While it may be easy to fall into traps and believe in false or misleading information, investors should always remember to analyze all available data and make a decision based on their knowledge of the market and of the stocks themselves. Although it may seem like a hard task, it is possible to invest with caution and come out with more wins than losses, or, at the very least, be able to avoid any severe losses that might occur. All in all, with the information provided in this article, readers should remember to take everything with a grain of salt and to continue learning and improving their understanding of the market so that they can make the best decisions for themselves. If readers remember the most important takeaways from the article, they will be able to properly evaluate the risks and rewards involved in investment decisions, which will lead to more success for the investor. Readers should not make any drastic decisions based on the opinions of one person or one article, but rather continue researching so that they can make the most well-informed decisions for themselves.
Source: Trading Plan: Will Nifty 50 defend 24,700, Bank Nifty manage to hold 54,550 amid rangebound trading?