Weekly Outlook: Nifty Still In Bullish Territory, SEBI RAs See Room For Upside If Key Levels Hold

Indian equity markets remained rangebound last week as investors awaited clarity over the U.S.-India trade deal ahead of the tariff deadline on July 9. Despite the sideways action, analysts say the broader trend is intact. Dips are seen as opportunities for positional traders, provided Nifty holds key support zones.

SEBI-registered analyst Mayank Singh Chandel noted that the Nifty 50 ended the previous week on a muted note, closing within a tight band of 25,300–25,700, which also happens to be within the prior week’s range. According to him, this price action suggested an indecision among market participants and signals a short-term consolidation phase. 

From a technical standpoint, the index has yet to confirm a breakout or breakdown. On the downside, Chandel highlighted that a decisive break below 25,330 could trigger a move towards 25,200, and if that level is breached, a further dip towards the 25,000–24,800 zone may be seen. 

On the upside, if it sustains above 25,650–25,700, it could attempt to retest 25,800, and potentially stretch toward 26,000, which remains a strong resistance. 

Analyzing momentum indicators: The Relative Strength Index (RSI) is currently hovering around 62.4, which is still in bullish territory but showing signs of a slight cooling off. Despite the sideways price action, an RSI above 60 suggests that underlying strength remains, although momentum is slowing. 

Meanwhile, the India Volatility Index (VIX) continued its downtrend for the third straight week, closing at 12.32, its lowest since September 2024. This indicates reduced fear and risk appetite.

Chandel also broke down the trends in the derivatives data. The options data indicate that 25,200–25,700 remains the immediate trading band, while the broader expiry range remains capped between 25,000 and 26,000. 

For the coming week, he expects continued consolidation with an eye on breakout or breakdown signals. A breakdown below 25,330 could lead to declines till 25,200–24,800, while a breakout above 25,700 could lead to a rally till 25,800–26,000. Chandel concluded that the outlook remains cautiously bullish till the VIX stays soft and RSI holds above 60. 

He advised traders to stay nimble, adding that in such rangebound conditions, non-directional option strategies or scalping near key support and resistance zones are favorable. 

A&Y Market Research believes that while the Nifty index witnessed a minor decline last week, the fall appeared to be shallow and showed signs of a healthy correction rather than a trend reversal. They added that the broader uptrend remained intact as long as the key support levels of 25,300 and 25,200 are protected, we are likely to see a rebound. 

A sustained move above these supports could take the Nifty higher to the 26,300 - 26,500 zone in the coming sessions. A&Y Market Research said that these dips offer a buying opportunity for positional traders.

For the Bank Nifty, they highlighted that the index was trading at a crucial juncture, with strong support placed at 56,500. The index needs to hold this level for upward momentum to resume. If sustained, they expect a rally to 57,500, followed by a breakout above this level to lead the index to 58,500. However, if Bank Nifty fails to hold 56,500, then A&Y Market Research noted that the index could correct to 55,500 before attempting a recovery. 

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