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On Friday, Indian benchmark indices closed with marginal gains, consolidating recent gains amid mixed global cues and the Bihar election results. The Nifty 50 closed 0.12% higher, settling slightly below 26,000, and the Sensex had a similar trajectory. Global sentiment, particularly the overnight decline in the US markets due to inflation concerns and technology valuations, initially weighed on the opening.

On the sectoral front, strength was witnessed in select segments such as Defence and Metals, while profit booking surfaced in Capital Goods and some high-flying mid-cap stocks. The broader market displayed a slight negative bias, with the overall advance-decline ratio hovering near 1:1, indicating stock-specific action rather than a directional move for the overall market breadth.

Indian equities ended a choppy session marginally higher on Friday, with Nifty 50 closing at 25,910.05, up 30.9 points (0.12%) after oscillating between 25,740.8 and 25,940.2. Sensex followed a similar trajectory, buoyed by late-session buying in select heavyweight stocks.

Sectoral performance was mixed. Nifty FMCG (+0.6%), Pharma (+0.6%), and PSU Banks (+1.2%) led the gains, while IT (-1.0%), Metal (-0.9%), and Auto (-0.5%) dragged on sentiment.

The advance-decline ratio reflected a slight negative breadth, with 1,483 stocks advancing against 1,623 declines, indicating subdued overall participation. Financials remained steady, with private and PSU Banks offering some resilience amid broader consolidation.

On the daily chart, price action shows a decisive breakout above a short-term consolidation zone, supported by sustained buying interest and rising volumes, indicating renewed bullish sentiment. The index is now trading comfortably above all its key moving averages.

The RSI, currently near 62, is trending higher after rebounding from the midline, suggesting strengthening momentum without entering overbought territory. This upturn in RSI aligns with improving market breadth and a pickup in cyclical sector participation.

Meanwhile, the MACD has generated a bullish crossover above the signal line, confirming a shift in momentum toward buyers. The histogram has also turned positive, reflecting increasing upside traction.

According to O'Neil’s methodology of market direction, the market status has shifted to a "Confirmed Uptrend" as it decisively surpassed its previous rally high of 25,670 to register a new 52-week.

The index ended flat in a highly volatile session, testing its 21-DMA and 25,700before rebounding sharply, indicating renewed buying interest at lower levels. A sustained move above 25,700 could open the path toward 26,000–26,100 in the near term. On the downside, immediate support is placed at 25,700, while a stronger base near 25,300 continues to underpin the broader uptrend and maintain overall market stability.

Nifty Bank opened on a weak note but witnessed a strong rebound as buying interest emerged at lower levels, swiftly recovering intraday losses. Marking its sixth consecutive bullish candle on the daily chart, the index continues to trade well above all its key moving averages, signaling robust upward momentum.

It opened at 58,050, touched an intraday high of 58,590.15, and closed at 58,517.55. The price action underscores renewed investor confidence and sustained bullish sentiment. A decisive breakout above current levels could propel the index toward new highs in the near term.

The momentum indicator RSI has edged higher to around 67, underscoring a steady and resilient bullish tone. Although approaching overbought territory, it continues to reflect underlying market strength. Simultaneously, the MACD has shown a minor negative crossover, indicating short-term consolidation, yet its position above the zero line confirms sustained positive momentum.

According to O’Neil methodology of market direction, Bank Nifty remains in a Confirmed Uptrend, supported by an improving technical structure and consistent buying on dips. Overall, the outlook remains bullish, with potential for fresh highs if momentum persists above current levels.

The index remains firmly positioned above all its key moving averages, underscoring strong underlying momentum. As long as it holds above the 21-DMA, placed near 57,946, the outlook remains constructive. A decisive move beyond this level could pave the way for an extended rally toward 58,700–59,000 in the near term.

On the downside, support is seen around 57,600–57,000, and a break below this band may trigger a brief corrective phase. Overall, the trend remains positive, favoring a buy-on-dips strategy amid sustained market strength.

MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. It offers tools and resources to help investors make informed decisions based on the CAN SLIM methodology, founded by legendary investor William J. O'Neil. You can access a 10-day free trial by registering on its website.

Trade name: William O’Neil India Pvt. Ltd.

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Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.

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