Nifty 50's Bearish Momentum Fades, Will Pullback Rally Persist Next Week?

Market Update: Nifty 50 Remains in a State of Indecision

The Nifty 50 index has been experiencing a prolonged period of indecision, with neither bulls nor bears establishing firm control. This phase of uncertainty often acts as a precursor to a decisive breakout, according to Sudeep Shah, the Head - Technical and Derivatives Research at SBI Securities.

Positive Divergence on RSI

Despite the negative bias in closing, a positive divergence is evident on the daily RSI, suggesting that the underlying weakness may be losing momentum. The index recently found support near an upward-sloping trendline, followed by a swift rebound. However, this divergence still requires validation through price action, with the 22,900–23,000 zone remaining a key resistance band.

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Technical Developments

In the derivatives space, the long-short ratio has seen a marginal uptick to 16.84 percent from 16.20 percent. However, Foreign Institutional Investors (FIIs) still maintain a strong net short positioning in index futures. The ratio has broadly hovered within the 10–16 percent band since early March, with no significant signs of short covering even during recent market pullbacks.

Bank Nifty Technical Analysis

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The banking benchmark, Bank Nifty, ended the week in negative territory for the sixth straight week. However, after touching a low of 49,954, the index staged a strong recovery, forming a Dragonfly Doji candlestick pattern. This pattern reflects robust buying interest emerging at lower levels following the recent sharp decline.

| Resistance Zone | 52,000–52,200 | | Support Zone | 50,900–50,700 |

Recommendations

Arvind

• Accumulate the stock in the zone of Rs 366-362 with a stop-loss of Rs 350.
• Upside potential: Rs 390 in the short term.

Steel Authority of India (SAIL)

• Accumulate the stock in the zone of Rs 154-157 with a stop-loss of Rs 147.
• Upside potential: Rs 168 in the short term.

Nifty IT Index

The Nifty IT index has been undergoing a phase of consolidation for the last 24 trading sessions. The ratio chart of Nifty IT against Nifty is forming a sequence of higher tops and higher bottoms, reinforcing its relative strength. In view of these technical developments, we believe that Nifty IT is poised to continue its pullback rally in the short term.

Nykaa

FSN E-Commerce Ventures (Nykaa) continues to trade within a narrow Rs 248–232 range since March 13, 2026, despite a strong 2.5 percent gain on April 2. The stock is hovering around its 200-day EMA, making this a crucial level to watch.

Hindalco and NALCO

Hindalco Industries and National Aluminium Company have witnessed a strong rally over the past couple of weeks, supported by robust sectoral momentum. The rising ratio line in NALCO/Hindalco ratio chart suggests that between the two, Nalco is relatively outperforming the latter. With strong sectoral support, any follow-through buying could extend the upmove, with NALCO better poised to lead the rally.