Sensex rose 166.5 points to close at 78,095, while the Nifty 50 gained over 66 points to end the session at 24,384. Broader markets also remained in the green, with the Nifty Midcap 100 and Nifty Smallcap 100 indices rising more than 0.4%.
Analyst Sudeep Shah, Vice President and Head of Technical & Derivatives Research at SBI Securities, interacted with ETMarkets regarding the outlook for the Nifty and bank, as well as an index strategy for the upcoming week. The following are the edited excerpts from his chat:
Nifty has rebounded almost 3% this week. What is your view on Nifty going forward?
Over the past 15 weeks, the benchmark Nifty has remained range-bound, oscillating between 24,601 and 23,070. This trading range has narrowed further over the last seven weeks, with the index confined within a tighter band of 24,530-23,605, reflecting a lack of strong conviction from both bulls and bears. Despite this prolonged consolidation, recent price action hints that the balance may be shifting.
Over the last six trading sessions, the index has staged a sharp recovery of more than 760 points, enabling it to end the month with gains of over 2% while closing near the upper end of its consolidation range. The rebound was primarily driven by heavyweights, with large-cap stocks leading the market higher. Notably, Nifty has formed candles with shadows on both sides for four consecutive months, underscoring the prevailing market indecision. So, what do the technical indicators suggest about the market’s next move?
From a technical perspective, the index is currently trading above its 20, 50, and 100-day EMA levels, while hovering around its 200-day EMA. On the weekly chart, all major moving averages remain largely flat, indicating the absence of a sustained trend. Momentum indicators and oscillators on both the daily and weekly timeframes also continue to signal a sideways bias. With the setup approaching a critical juncture, the next few levels are likely to decide the market’s direction.
Going forward, the 24,550-24,600 zone is expected to act as a crucial resistance area, as it coincides with previous swing highs. A decisive breakout above 24,600 could pave the way for a rally towards 24,900, with the potential to extend further to 25,200 in the near term. On the downside, the 24,150-24,100 zone is likely to provide strong support, and holding above this region will be crucial for maintaining the positive bias.
IT index jumped a staggering 7% this week. How are charts looking and what’s the strategy for stocks in the sector?
Nifty IT has staged a strong recovery, rallying nearly 18.5% from its July 1 low of 25,699. While the index recently faced resistance near its 200-day EMA and witnessed some profit booking, the broader technical structure has improved considerably.The index has reclaimed its 20-week EMA for the first time since January 2026, indicating a meaningful improvement in the medium-term trend. Additionally, the MACD remains in a bullish crossover with rising green histogram bars, reflecting upward momentum.
The 29,800–29,750 zone is expected to act as immediate support. As long as the index sustains above this zone, the ongoing pullback is likely to extend towards higher levels.
Within the IT space, Persistent Systems, HCLTech, Tech Mahindra, and Coforge continue to display strong price structures and are well placed to extend their recovery, provided they hold above their respective support zones.
Any inputs on the Seasonality front, are there any interesting observations pertaining to the Market Trend over the last 10 years?
The Sensex has exhibited a relatively mixed performance during the month of August over the last 11 years. The index has ended the month in positive territory in 6 out of 11 years, delivering an average gain of 3.42%, while it has closed in the red on 5 occasions, with an average decline of 2.71%. Notably, in 2 of the last 3 years, namely 2023 and 2025, the Sensex ended August with losses of 2.55% and 1.69%, respectively.
Nifty’s performance has largely mirrored that of the Sensex. Over the last 11 years, the index has ended August higher in 6 years, posting an average gain of 3.46%, while it has recorded negative returns in 5 years, with an average loss of 2.58%. Similar to the Sensex, Nifty ended August in the red in 2023 and 2025, declining by 2.53% and 1.38%, respectively.
Historically, the FMCG sector has demonstrated favorable seasonality during August. Based on the last 20 years of historical data, the FMCG index has ended the month in positive territory in 13 out of 20 years, delivering an average gain of 2.84%. Since the post-COVID recovery period, the sector has witnessed only one negative August performance, falling 2.93% in August 2023, while ending the month in the green in all other years.
The PSE sector has also exhibited strong long-term August seasonality, ending the month higher in 12 out of the last 20 years with an average gain of 3.07%. However, recent trends have been less encouraging, with the index closing August in negative territory in each of the last three years, registering an average decline of 2.52% during this period.
The Auto sector has historically been one of the strongest performers during August. The index has ended the month in the green in 12 out of the last 20 years, generating an average gain of 5.30%. From a technical perspective, the index gave a 25,296-27,761 consolidation breakout on the daily timeframe. Given the sector’s historically favorable August seasonality, a sustained move above the upper end of the consolidation range could potentially trigger a fresh leg of the uptrend and pave the way for further upside in the coming month.
The IT sector has also displayed robust August seasonality. Over the last 20 years, the index has ended the month in positive territory in 12 instances, delivering an average gain of 5.87%. More recently, the index generated gains of over 4% in August 2023 and August 2024, while recording only a modest decline of 0.34% in August 2025. From a technical standpoint, the Nifty IT Index has rebounded nearly 18.5% from its low of 25,699 recorded on 1 July, indicating improving sentiment within the sector. If historical seasonality trends continue to play out, the ongoing recovery could extend further, allowing the index to build on its recent gains and outperform during the upcoming month.
What is the options data indicating about Nifty’s near-term trading range, and where are the key Call and Put positions building up?
Nifty has rebounded 778 points from its July 24 low of 23,606. Encouragingly, the index closed marginally above its 200-day EMA for the first time since July 6, indicating an improvement in the near-term technical structure.
From a broader perspective, however, Nifty continues to trade within the 24,531–23,606 range. Notably, the index had failed to sustain above its 200-day EMA on July 7, triggering a corrective decline. Therefore, the 24,550–24,600 zone remains a crucial hurdle on the upside.
The options data reinforces this view. The 24,600 strike has witnessed aggressive Call writing, with Call additions nearly 16 times higher than Put writing, making it a strong resistance zone. A decisive breakout above 24,600 could trigger fresh short covering, paving the way for further upside.
On the downside, the 24,000 strike holds the highest Put Open Interest, with Put writing nearly nine times higher than Call writing. This makes 24,000 a strong support level. However, a sustained breach below this mark could force Put writers to unwind their positions, potentially accelerating the downside move.
What are some stocks that are looking good for the week ahead?
Technically, Chola Finance, Paytm, Motherson, Torrent Pharma and Siemens are looking good.
What’s your strategy for Eternal, Vedanta, Adani Ports, Bajaj Finance, and Infosys?
Eternal:
Eternal gave a consolidation breakout on July 28 and has also closed above the previous three weeks’ high, reinforcing the bullish setup. The stock is trading above all key short and long-term moving averages, while the weekly RSI continues to trend higher, indicating strengthening momentum. The Rs 290–285 zone, which coincides with the 20-day EMA, is expected to act as a strong support. The bullish bias is likely to remain intact as long as the stock holds above this support.
Vedanta:
Vedanta is consolidating within a Rs 270–259 range, with the stock oscillating between its 20-day and 200-day EMAs, reflecting a lack of clear directional bias. The MACD has flattened and remains below the zero line, indicating a sideways trend. A decisive breakout above Rs 270 or a breakdown below Rs 259 is likely to provide the next directional move.
Adani Ports:
Adani Ports has broken below an upward-sloping trendline support on the daily chart and has since drifted lower. The stock has also slipped below its 100-day EMA, while the RSI continues to trend lower, reflecting weakening momentum. The rising ADX suggests that the prevailing downtrend is gaining strength. As long as the stock trades below the Rs 1,775–1,780 zone, the bearish bias is likely to persist.
Bajaj Finance:
Bajaj Finance retested its 20-day EMA and witnessed a strong rebound, reaffirming the underlying bullish trend. Earlier, the stock had broken above a downward-sloping trendline resistance on July 1, followed by a healthy rally and a successful retest of the breakout zone, which has now turned into a strong support.
The RSI has turned higher after consolidating around the 60 mark, signalling a revival in bullish momentum. At the same time, the DI+ remains well above DI-, highlighting strong buying interest. The stock is also trading above the upper Bollinger Band, a characteristic often seen during strong trending phases.
Adding to the positive outlook, the Bajaj Finance/Nifty Financial Services ratio chart has broken above a downward-sloping trendline on the weekly timeframe, indicating the stock is well placed to outperform its benchmark in the near term. The Rs 1,075–1,070 zone is expected to act as a strong support, and the bullish bias is likely to remain intact as long as this level holds.
Infosys:
Infosys faced stiff resistance near its 100-day EMA and ended the session lower. Despite recovering more than 10% from its July 24 low of Rs 1,014, the stock has struggled to sustain higher levels. The RSI has slipped below the 60 mark, indicating a pause in bullish momentum. The Rs 1,170–1,175 zone remains the immediate resistance, and a decisive breakout above this range could trigger a further extension of the ongoing pullback.
