Market Recap and Current Momentum

The Indian equity markets extended their winning streak on Wednesday, September 17, 2025, closing higher for the second consecutive session. The Nifty 50 gained 91.15 points (0.36%) to close at 25,330.25, while the Sensex advanced 313.02 points (0.38%) to settle at 82,693.71. The Bank Nifty outperformed with a strong gain of 345.70 points (0.63%) to close at 55,493.30, marking its 11th consecutive session of gains.

The market breadth remained positive with broad-based participation across sectors, particularly in PSU banks, IT, auto, and oil & gas stocks. Key gainers included Tata Consumer, SBI (+3.08%), and Kotak Mahindra Bank (+2.58%).

Technical Analysis

Nifty 50 Technical Setup

The Nifty has formed a strong bullish candle with higher highs and higher lows, signaling continuation of the upward momentum. Key technical observations:

Support Levels:

• Immediate Support: 25,275-25,300 (crucial for trend continuation)
• Strong Support: 25,150-25,000 (major support zone)
• Critical Support: 24,900 (21-day EMA)

Resistance Levels:

• Immediate Resistance: 25,400-25,500 (key breakout levels)
• Target Levels: 25,550-25,600, followed by 25,669 (yearly high)

Technical Indicators:

• RSI: At 66, showing bullish momentum but approaching overbought territory
• Moving Averages: Trading above all key EMAs with bullish crossover of 20 and 50-day EMAs
• Pattern: Higher high-higher low formation with bullish gap support at 25,240-25,270

Bank Nifty Analysis

Bank Nifty continues its impressive run with strong momentum:

Key Levels:

• Resistance: 55,820 (futures level), 56,000-56,150 (major resistance zone)
• Support: 55,200 (immediate), 54,800-54,650 (strong support)
• Target: Break above 55,820 could lead to 56,200-56,250

Global Market Cues and Fed Impact

US Federal Reserve Rate Cut

The US Fed delivered its first rate cut of 2025, reducing rates by 25 basis points to 4.00%-4.25%. Key highlights:

• Future Guidance: Fed signaled two more 25 bps cuts expected in 2025
• Economic Outlook: Raised GDP growth forecast to 1.6% from 1.4%
• Market Reaction: Initial rally followed by mixed trading in US markets
• Powell’s Stance: Called it a “risk management cut” rather than response to weak economy

Global Market Response

Asian Markets (September 18 Pre-market):

• Nikkei 225: Hit fresh record high at 45,162.80 (+0.83%)
• Hang Seng: Mixed at 26,877.90 (-0.11%)
• SGX Nifty: Trading positive at 25,494 (+80 points/+0.31%), indicating strong opening for Indian markets

US Markets (Post-Fed):

• Dow Jones: Gained 260.42 points (+0.57%) to 46,018.30
• S&P 500: Slight decline of 6.41 points (-0.10%)
• Nasdaq: Declined 72.63 points (-0.33%)

Institutional Activity

FII/DII Flow Analysis

September 17, 2025 Data:

• FII: Net sellers of ₹1,124.54 crores in cash segment
• DII: Strong net buyers of ₹2,293.53 crores
• FII Index Futures: Positive buying of ₹1,708.09 crores

Month-to-Date (September 2025):

• FII Net Outflow: ₹11,329.08 crores
• DII Net Inflow: ₹32,892.91 crores

The consistent DII buying pattern continues to provide strong support to market sentiment, effectively absorbing FII selling pressure.

Sector Performance and Stock Highlights

Banking Sector Leadership

The banking sector emerged as the star performer on September 17:

Top Gainers:

• Bank of Maharashtra: +4.09% (top PSU bank gainer)
• SBI: +3.08% to ₹857.15
• Kotak Mahindra Bank: +2.58%
• Canara Bank: +2.67%
• Bank of Baroda: +2.21%

Banking Index Performance:

• S&P BSE BANKEX: Up 0.8% at 62,427.4
• Nifty Bank: Outperformed main index with 0.63% gain
• PSU Bank Index: Gained over 2.50%

Other Sector Highlights

Sectoral Performance (September 17):

• PSU Banks: Leading gainer with 2.50%+ gains
• IT Sector: Advanced 0.65%
• Auto Sector: Rose 0.55%
• Oil & Gas: Up 0.63%

Laggards:

• FMCG, Consumer Durables, Metals: Under pressure

Derivatives and Options Analysis

Key Options Data

The options chain reveals strong bullish sentiment:

Call Side (Resistance):

• 25,500 CE: Maximum OI at 70.7 lakh contracts (key resistance)
• 26,000 CE: Highest OI at 85.2 lakh contracts (major ceiling)
• 25,400 CE: Immediate resistance with significant writing

Put Side (Support):

• 25,000 PE: Strong support with 45.5 lakh contracts
• 24,850 PE: Additional support level

Put-Call Ratio (PCR): Elevated levels supporting bullish sentiment

India VIX – Historic Low Signals

The India VIX closed at 10.27, down 1.2% and near lifetime low of 10.12. This indicates:

• Extremely low volatility expectations
• High investor confidence but potential complacency
• Historically, such low VIX levels have preceded market rallies

Currency and Commodity Markets

Indian Rupee

• USD/INR: Trading around 87.73, showing stability post-Fed cut
• Fed rate cut expected to strengthen rupee due to improved carry trade attractiveness

Commodity Prices

• Crude Oil: WTI at $63.69 (-0.56%), Brent showing stability
• Gold: Trading lower at $3,691.70 (-0.70%) post-Fed decision

Market Outlook for September 18, 2025

Positive Catalysts

1. Fed Rate Cut Impact: First easing of 2025 cycle supporting risk appetite
2. Technical Momentum: Nifty holding above 25,300 with bullish pattern intact
3. DII Support: Continued strong domestic institutional buying
4. Banking Sector Revival: Outperformance indicating sector rotation
5. Low Volatility: VIX at historic lows suggesting stable market conditions
6. Pre-market Strength: SGX Nifty positive indicating good opening

Key Resistance and Support Levels

Nifty 50:

• Resistance: 25,400-25,500, then 25,600-25,669
• Support: 25,275-25,300, critical at 25,150-25,000

Bank Nifty:

• Resistance: 55,820, then 56,000-56,150
• Support: 55,200, strong at 54,800-54,650

Trading Strategy

For September 18, 2025:

1. Nifty Strategy: Buy on dips above 25,300 with targets of 25,500-25,600
2. Bank Nifty: Continue bullish stance above 55,200 targeting 56,000+
3. Risk Management: Stop-loss below 25,150 for Nifty, 54,800 for Bank Nifty
4. Sector Focus: Banking, auto, and IT sectors showing momentum

Risk Factors to Monitor

1. Overbought Conditions: RSI approaching 70 levels requiring caution
2. FII Selling: Continued monthly outflows despite positive futures buying
3. Global Uncertainty: Mixed Asian market response to Fed cut
4. Complacency Risk: Extremely low VIX may mask underlying risks

 

Conclusion

The Indian equity markets are well-positioned for continued gains on September 18, 2025, supported by the Fed’s dovish pivot, strong technical momentum, and robust domestic institutional flows. The banking sector’s outperformance and Nifty’s breakout above 25,300 provide a solid foundation for further upside.

However, traders should remain vigilant about overbought conditions and maintain proper risk management strategies. The 25,400-25,500 zone remains crucial for Nifty’s next leg of rally, while Bank Nifty eyes the 56,000 milestone.

Disclaimer: This analysis is for informational purposes only and should not be considered as investment advice. Please consult with your financial advisor before making any investment decisions. Past performance does not guarantee future results. 

***Data Sources :-

• https://www.reuters.com/business/fed-lowers-interest-rates-signals-more-cuts-ahead-miran-dissents-2025-09-17/
• https://www.financialexpress.com/business/investing-abroad-us-fed-fomc-meeting-september-2025-live-updates-check-us-fed-rate-cut-interest-rate-cut-announcement-latest-news-3980914/
• https://www.moneycontrol.com/news/business/markets/trade-setup-for-september-18-top-15-things-to-know-before-the-opening-bells-13555045.html
• https://www.etnownews.com/markets/nifty-prediction-tomorrow-by-experts-for-18-september-daily-chart-candlestick-pattern-next-target-support-resistance-article-152844271
• https://www.ndtvprofit.com/markets/trade-setup-nse-nifty-50-bank-support-resistance-levels-outlook-september-18-2025

Analyst Name: Pradeep Suryavanshi

Bestmate Investment Services Pvt. Ltd.:
A-1-605, Ansal Corporate Park Sec-142, Noida 201305
CIN: U74999UP2016PTC143375
SEBI Registration Number: INH000015996
Website: www.bestmate.in
Email: pradeep@bestmate.in

Download :- nifty 18-09-2025

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