NIFTY has been assessed as having completed a five-wave rally followed by a three-wave pullback, described as a textbook Elliott Wave bullish sequence. On the one-hour chart dated 06.23.2026, the decline from the peak is labelled an Elliott Wave Zig Zag, with the Equal Legs zone used to frame the projected support and potential buying area.
The Equal Legs range is calculated via the Fibonacci extension tool, with the “ideal support area” set at 23876.66–23695.88. Price is reported to have found buyers in that band and then rallied towards new highs, leaving long positions initiated at the zone characterised as risk-free. The outlook retains a 3-7-11 swing structure bias, contingent on the pivot low at 2307.12 holding, while the broader framework cites higher-time-frame cycle analysis, correlation analysis and wider market context as additional inputs.
Technical and Macro Drivers Support Bullish Outlook
As we saw in late June, the NIFTY index successfully found support around the 23,700 level and has since resumed its upward trend. This price action confirms the underlying strength in the market. We believe this momentum will carry forward into the coming weeks.
This technical strength is supported by solid macroeconomic fundamentals, with recent government data showing India’s Q1 2026 GDP growth hitting an impressive 7.8%. This strong economic performance is attracting significant capital. We are seeing foreign institutional investor (FII) inflows for June 2026 reaching over ₹30,000 crore, the highest in three months.
Strategy Approaches and Risk Management
Given this bullish outlook, we are considering long positions in NIFTY futures contracts for the July and August expiries. The key is to manage risk around the recent pivot low of 23,707. Any dips toward the 24,000 level could present attractive entry points for building these positions.
For those looking for a more conservative approach, we see an opportunity in selling out-of-the-money put options. The India VIX has recently settled below 14, indicating lower expected volatility and making option premiums attractive for sellers. Selling puts with strike prices around 23,800 and 23,900 allows us to collect income while defining a favorable entry point if the market pulls back.
We also favor bull call spreads to capitalize on the expected measured rise towards new highs. A spread, such as buying a 24,200 call and selling a 24,500 call for the end-of-July expiry, offers a defined-risk way to profit from the upward move. This strategy is particularly effective in a market that is grinding higher rather than experiencing explosive rallies.
Historically, July can be a volatile month due to the progression of the monsoon and the beginning of the new earnings season. While our primary view remains bullish, we will be watching corporate earnings previews closely. We will use any short-term volatility to add to our bullish positions, provided the key technical structure remains intact.
