Index Outlook: Nifty 50, Sensex sparkle with a bullish breakout
Nifty 50, Sensex and Nifty Bank index have risen well and closed on a strong note ahead of Diwali. The much-awaited bullish breakout on the Nifty and Sensex happened last week. The indices were up 1.68 per cent and 1.76 per cent respectively. This marks the end of the correction.
The Nifty Bank index, up 1.95 per cent, is moving up in line with our expectation. Overall, the sentiment is positive. Our broader bullish view remains intact. The breakout last week gives a strong signal that more rise is on the cards.
Among the sectors, the BSE Realty index outperformed last week by surging 4.12 per cent. The BSE IT index, down 2.3 per cent, was beaten down the most.
FPIs buy
Foreign Portfolio Investors (FPIs) bought Indian equities for the second consecutive week. The equity segment saw a net inflow of $988 million. If the FPIs increase their purchase quantum, that would help the Sensex and Nifty to scale new highs in the coming weeks.
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Nifty 50 (25,709.85)
Short-term view: The outlook is bullish. Immediate resistance is at 25,830. A break above it can take the Nifty up to 26,100-26,200. In case, 25,830 caps the upside for now, a dip to 25,400 can happen first. Thereafter a fresh bounce can trigger the rise to 26,100-26,200.
The level of 26,200 is a strong short-term resistance. A corrective fall to 25,500 from around 26,100-26,200 cannot be ruled out.
Medium-term view: The rise last week confirms the resumption of the broader uptrend. That keeps intact our view of the Nifty rising to 28,000-29,000 in the medium term and 31,000 in the long term. A decisive break above 26,200 can accelerate the rally.
Cluster of supports in the 25,500-25,000 region can limit the downside. Below that, 24,000-23,500 will continue to act as the next strong support. Nifty has to decline below 23,500 to negate our bullish view.
Nifty Bank (57,713.35)
Short-term view: The rise to 58,500 mentioned last week is happening in line with our expectation. The outlook is bullish. Supports are at 57,200, 57,000 and 56,800. Nifty Bank index can touch 59,000 in a couple of weeks.
After this rise, a corrective fall to 57,500 or even 57,000 is possible. Such a fall can be a good buying opportunity.
Medium-term view: The bullish view is intact. Nifty Bank index can rise to 59,000-60,000 first. After the aforesaid corrective fall to 57,500-57,000, the Nifty Bank index can resume the uptrend and target 61,000-62,000 eventually.
Strong support is in the broad 57,000-56,000 region. Below that, 55,000-54,500 region will be the next crucial support which has to be broken to turn the outlook bearish.
Sensex (83,952.19)
Short-term view: The outlook is bullish. Immediate resistance is at 84,200. If that holds, a short-lived dip to 83,300-83,200 is possible. Thereafter the Sensex can rise back to break 84,200 and target 85,300 on the upside. After this rise, there are good chances to see a dip to 84,200 or 83,300 before rising further.
Medium-term view: We retain our bullish view. Sensex can target 88,000-89,000 in the medium term and 91,000-92,000 in the long term. If the momentum is strong, then the upside can extend even to 94,000-95,000 in this leg of rally.
Strong supports are in the 80,000-79,000 and 78,000-77,000 region.
Nifty Midcap 150 (21,782.80)
The Nifty Midcap 150 index remained higher but stable all through the week. The 20,600-22,100 range remains intact. The overall view remains the same.
Supports are at 21,700 and 21,400. As long as these supports hold, the short-term outlook is bullish to see a rise to 22,000-22,100. Only a break below 21,400 will turn the outlook negative for a fall to 20,900-20,700.
A decisive break above 22,100 eventually will confirm the bullish inverted head and shoulder pattern. It can then boost the momentum. That will then keep the doors open for the Nifty Midcap 150 index to target 23,000-23,500 in the medium term and 25,000-25,500 in the long term.
As mentioned last week, the region around 20,000 is a strong support. The outlook will turn bearish only if the index declines below this support.
Nifty Smallcap 250 (17,076.55)
The Nifty Smallcap 250 index is stuck inside a narrow range over the last couple of weeks. The immediate outlook is mixed and unclear.
Immediate support is at 16,880. A break below it can take the index down to 16,700 or 16,550.
Resistances are at 17,150 and 17,300. A strong break above 17,300 is needed to gain strength and rise to 18,000.
From a long-term perspective, a break above 18,100 will confirm the bullish inverted head and shoulder pattern. It will then take the Nifty Smallcap 250 index up to 20,000 in the medium term and 21,500-22,000 in the long term.
The region around 16,500 is a crucial support. The outlook will turn bearish only if the index declines below it.
Published on October 18, 2025