Indian Market Analysis for the week ended 20th June 2025 - On the brink of a breakout?

💡 Nifty has shown remarkable resilience in the week gone by in the face of adverse geopolitical circumstances, a falling rupee and rising crude oil prices. A brief timeline follows.

Nifty had been consolidating in a tight range since the 12th of May for a period of 4 weeks before it attempted to break out on the 9th of June. However, after spending 3 weak days above the upper boundary of the range ~25100, it could not sustain and fell to test the lower boundary of the range ~24470 on Friday the 13th of June, coinciding with the news of overnight attack by Israel on Iran.

However, what was remarkable about the day was that the open was also the low of the day and Nifty rallied for the rest of the day to form a strong green candle, despite adverse news. This was a strong indication of the underlying bullish momentum. After consolidating for the next 4 days, Nifty finally erupted last Friday, the 20th of June, to close right at the upper boundary above 25100, forming another strong green candle. A second breakout looks imminent in the days to come. Look as the daily chart of Nifty below.

Daily chart of Nifty illustrating a second breakout imminent from a trading range

💡 Banknifty has a similar chart pattern, with the index showing all the signs of a second breakout from a range after failure of the first breakout. Daily chart below.

Daily chart of Banknifty illustrating a second breakout imminent from a trading range

💡 Meanwhile, CNXIT has already broken out from a reverse H&S pattern in the last week for a second time after a first failure in the prior week. Daily chart below.

Daily chart of CNX IT illustrating a second breakout from a reverse H&S pattern

💡 CNX MidCap and SmallCap indices have both formed a strong bullish pattern last Friday, with the former forming a Bullish Engulfing pattern and the latter a Bullish Harami pattern after a sell signal the previous day, aka a sell failure. Daily chart below

Daily chart of CNX MidCap illustrating a Bullish Engulfing pattern after a sell signal, a sell failure

Overall, the market looks very bullish with Nifty poised to test the ATH, a little more than 1100 points away in the near future. This is how the technical picture stands, however, with news of US attacking Iran this weekend, only time will tell how the markets react on Monday.

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