In the previous session, the Nifty 50 rebounded by nearly 0.5 percent after witnessing a sharp decline in the prior session, supported largely by strength in banking stocks. Despite the recovery, the broader trend remains weak as the index continues to trade below all key moving averages. However, the formation of a bullish reversal-type pattern near an important support zone suggests that selling pressure may be easing in the near term.
From a technical standpoint, the Nifty 50 formed a small-bodied bearish candle with a long lower shadow on the daily chart, resembling a Dragonfly Doji-type pattern, which is generally considered a bullish reversal signal. The index remains below all major moving averages, which continue to slope downward, indicating that the broader trend remains under pressure. The RSI improved to 39.58 but remained below its reference line, while the MACD continued to stay below the signal line. However, fading weakness in the histogram indicates a possible improvement in momentum.
As long as the index remains above the immediate support zone of 23,100–23,000, the possibility of a recovery cannot be ruled out. On the upside, the crucial resistance zone remains at 23,500–23,600. A sustained move above this range may trigger fresh buying interest and open the path towards 23,800–24,000 in the coming sessions.
Derivatives data reflects an improvement in sentiment. The Nifty Put-Call Ratio (PCR) jumped to 1.06 on June 9 from 0.78 in the previous session, indicating aggressive put writing and improving bullish sentiment among traders. A PCR above 1 generally reflects a supportive undertone for the market.
The India VIX, which measures expected market volatility, declined sharply by 8.53 percent to 15.57, slipping below all key moving averages. The decline in volatility indicates improving comfort for market participants. However, a sustained move below the 15 mark would be required to strengthen bullish confidence further.
Option chain positioning suggests strong support around the 23,000 strike, where notable put writing activity was visible. On the upside, significant call writing remains concentrated around the 23,500–23,600 zone, making it the immediate hurdle for the index.
In terms of price structure, Nifty is attempting to form a base near the lower end of its recent trading range. While the broader trend remains corrective, the emergence of buying interest at lower levels and improving derivatives indicators suggest that downside risks may be moderating.
Bank Nifty outperformed the benchmark index and rallied 2.09 percent, forming a strong bullish candle on the daily chart. The banking index surpassed the previous week’s high and reclaimed its short- and medium-term moving averages with above-average volumes, indicating renewed buying interest.
Immediate support for Bank Nifty is placed around 54,400–53,800, while resistance is seen near 55,500–56,100. A sustained breakout above this resistance zone could pave the way for further upside in the banking index.
Overall, the technical setup indicates a cautious start due to weak global cues, but domestic charts suggest signs of stabilization after recent selling pressure. The broader trend remains range-bound, with 23,100–23,000 acting as crucial support and 23,500–23,600 remaining the key resistance zone. A decisive breakout on either side is likely to determine the next directional move for the market,” says Aakash Shah, Technical Research Analyst at Choice Equity Broking Private Limited.