Market Remains Range-Bound Ahead of Key Breakout

The Indian stock market is expected to remain range-bound until it decisively breaks out of last week's 23,100–23,700 range on either side. Momentum indicators continue to suggest a lack of clear direction, with the Nifty 50 index trading within a narrow range.

Key Levels to Watch

On the higher side, the index may attempt to reclaim the 23,500–23,550 zone, which is also near the 10-day EMA and Friday's high. A decisive move above this zone could open the door for 23,650 (20-day DEMA). Conversely, if the index falls below 23,300 amid sell-off in US markets and West Asia crisis, bears could drag the index towards the 23,100–23,000 levels.

Read also: Nifty Falls Over 260 Points, Suggests Weak Market Open Amid Global Selloff and Middle East Tensions

Bank Nifty Outperforms Nifty 50

Meanwhile, Bank Nifty continues to outperform the Nifty 50. If the banking index scales above 55,000 (50-day EMA), a rally towards the 55,500–56,000 zone is possible. However, a convincing fall below 54,100, which is an immediate key support level, could strengthen the bears.

Market Performance

On June 5, the Nifty 50 fell 50 points to 23,367, while the Bank Nifty climbed 188 points to 54,496. Market breadth was weak, with about 1,615 shares declining against 1,384 advancing shares on the National Stock Exchange.

Read also: Nifty, Sensex Expected to Open Lower Amid Global Technology Selloff

Nifty Outlook and Strategy

According to experts, the Nifty 50 failed to build on the strength of the banking index during the week, suggesting a lack of broad-based participation. A well-defined range has emerged on the weekly chart, with the upside capped near the 24,000 mark, which aligns closely with the 20-week EMA and continues to act as a formidable resistance zone.

Technical Analysis

Hitesh Rathi, Technical Analyst (Equity & Derivatives) at Angel One, suggests that a move above 23,550 could trigger fresh upside momentum. Conversely, a breakdown below the 23,200–23,100 support band is likely to shift the balance in favour of the bears.

Strategy

As long as prices remain range-bound, a strategy of buying near support levels and booking profits or selling near resistance zones is likely to provide better trading opportunities.

Key Resistance and Support Levels

Bank Nifty Outlook and Positioning

The Bank Nifty index delivered a resilient performance during the week, overcoming early weakness and gradually recovering from a key support zone. Sustained buying interest aided the rebound, enabling the index to regain lost ground.

Technical Analysis

Rajesh Palviya, Senior Vice President Research (Head of Research) at Axis Securities, suggests that a decisive breakout above the medium-term downward-sloping trendline could trigger fresh buying momentum and drive the index towards the 55,500–56,250 zone.

Strategy

A strategy of buying Bank Nifty Futures on dips around 53,900–53,800, with a stop-loss at 53,200, and booking profits near 55,000 is likely to provide better trading opportunities.

Key Resistance and Support Levels

Technical Analysis

Anshul Jain, Head of Research at Lakshmishree Investments, suggests that a follow-through move above the hammer high at 54,865.5 would confirm bullish intent and likely trigger fresh short-covering, opening the door for a move towards the recent daily swing high near 55,536.8.

Strategy

A strategy of buying Bank Nifty Futures above 54,865 for a target of 55,537, with a stop-loss below 54,500, is likely to provide better trading opportunities.