1. Overview
As of the current trading session, Nifty 50 is trading around 25,460, displaying a mild correction from its recent highs. The index has seen a strong uptrend from the lows of late June, followed by a consolidation phase that is now showing signs of a potential breakout. Both the daily and hourly charts present crucial technical signals that could determine the near-term and medium-term direction of the Indian benchmark index.
2. Daily Chart Analysis
Trend Overview
- The daily chart shows that Nifty 50 is in a broader uptrend, supported by a rising trendline and consistent higher highs and higher lows.
- The price recently broke out above a horizontal resistance zone (around 25,200), and now this zone is acting as a support level.
- The Bollinger Bands are contracting, suggesting low volatility and a potential upcoming breakout move.
Chart Pattern
- A bullish flag/pennant formation is visible. After a sharp rally in late June, the index has entered a consolidation channel bounded by a slight downward sloping resistance line and an upward sloping support trendline.
- This is a classic continuation pattern, and a breakout above the flag resistance can trigger a fresh upside leg.
Support & Resistance Zones
| Level | Description |
|---|---|
| 25,200 | Horizontal breakout support (previous resistance) |
| 25,460 – 25,500 | Current resistance zone, also near the Bollinger Band mid-level |
| 25,794 | Upper Bollinger Band and short-term swing high |
| 26,278 | Next potential resistance, previous price projection zone |
| 24,607 | Lower Bollinger Band – strong downside cushion |
| 23,224 | Major support (March-April consolidation base) |
Volume Analysis (Daily)
- The volume is moderate, with no extreme spikes recently, indicating a healthy consolidation phase.
- A breakout backed by above-average volume will confirm the continuation of the uptrend.
3. Hourly Chart Analysis
Short-Term Trend
- The hourly chart confirms a symmetrical triangle pattern, with both resistance and support trendlines converging.
- The breakout appears to be just at the apex, indicating a decisive move is imminent — likely within the next 1-2 sessions.
Bollinger Bands Insights
- Bollinger Bands on the 1H chart are tightening, reflecting a volatility contraction phase, which generally precedes a sharp directional move.
- The price is currently attempting to sustain above the mid-band, showing slight bullish momentum.
Price Action Observation
- Short-term consolidation has held well above 25,360–25,400, showing strong buying interest on dips.
- A clear break and hold above 25,500–25,520 will likely result in momentum buying.
Volume Analysis (Hourly)
- Hourly volume is stable, but we haven’t seen aggressive accumulation yet. Watch for volume surge during breakout attempts.
4. Indicators & Moving Averages
- SMA 20 (BB Basis Line): Acts as immediate support on both daily and hourly charts (near 25,200 on daily and 25,433 on hourly).
- RSI (Not shown but inferred): Likely neutral to mildly bullish based on price consolidation and higher lows.
- MACD: On shorter time frames, MACD may be on the verge of a crossover depending on today’s session movement.
5. Possible Scenarios
✅ Bullish Case
- Breakout above 25,500–25,520 on strong volume.
- Immediate target: 25,794, followed by 26,278 (as marked on chart).
- Stop-loss for long positions can be placed below 25,200, which is the base of the current pennant/flag formation.
⚠️ Neutral/Range-bound Case
- Index continues to consolidate between 25,200 – 25,500.
- Wait for breakout confirmation before initiating trades.
❌ Bearish Case
- Break below 25,200 may trigger a short-term correction.
- Possible downside targets: 24,607 and then 24,200 (lower Bollinger Band and trendline support).
- Bearish invalidation level: Close above 25,520.
6. Strategic Takeaways
For Traders:
- Buy on breakout: Entry above 25,520, with targets 25,800 / 26,280.
- Sell on breakdown: Below 25,200, target 24,600 / 24,200.
- Use trailing stop-loss post-breakout for momentum trading.
For Investors:
- Trend remains bullish in higher timeframes.
- Hold positions unless the index closes below 24,600 (which may hint at trend reversal).
7. Macro & External Factors to Monitor
- Global cues from Dow Jones, Nasdaq, and Crude oil prices.
- Any RBI policy commentary or macro data releases.
- FII/DII activity – strong FII buying may trigger further rally.
8. Conclusion
The Nifty 50 index is in a bullish consolidation phase, forming a flag/pennant on the daily chart and a symmetrical triangle on the hourly chart. These are typically continuation patterns, suggesting that the next move could be a resumption of the prior uptrend — especially if the breakout occurs with strong volume.
Key confirmation level: 25,520
Crucial support: 25,200
Upside potential: 25,794 → 26,278
Watch closely for a breakout in the coming sessions. Patience and precision will reward disciplined traders in this setup.
