The Indian stock market is likely to begin the trading session on Monday on a bright note as Gift Nifty trades at 23,795, signaling a good gap-up opening of almost 170 points above Nifty futures' close. This comes in the wake of a decent gain in global markets over the weekend.
Market Review: Friday's Bloodbath
On Friday, the benchmark indices closed sharply lower:
- Sensex fell 1,176.46 points (-1.49%) to close at 78,041.59.
- Nifty 50 declined 364.20 points (-1.52%) to close at 23,587.50.
The Nifty 50 recorded a weekly loss of 4.77%, breaking its 200-day EMA and forming a bearish engulfing pattern on the weekly chart—a sign of potential medium-term weakness.
> Key Technical Levels for Nifty 50
| Support Zones:
Critical support lies at 23,263, with further downside risks if breached, potentially targeting 22,800.
Swing low support around 23,200-23,100 could provide temporary stability.
| Resistance Zones:
- Intermediate resistance is set between 23,800-24,000, with a stronger hurdle at 24,150-24,300, aligning with bearish gaps and EMA clusters.
"The 24,000 level continues to act as a strong resistance as the heavy call writing between 23,700 and 24,000 continues to command. The bearishness could continue unless Nifty touches the 24,200 zone, feels Om Mehra, Technical Analyst at SAMCO Securities.
> Nifty OI Data: Bearish Undertone
- The highest call open interest is at 93.22 lakh on the 24,000-strike, which explains the resistance.
- On the put side, the major support comes from the 23,000-strike where the open interest is placed at 82.65 lakh contracts.
- The PCR moved higher to a level of 0.71, which is bearish in nature
> Bank Nifty Outlook - Bearish Momentum Continues
Bank Nifty closed at 50,759.20 on Friday, down 816.50 (-1.58%), leaving a bearish engulfing pattern.
| Support Levels :
50,200 and if that breaks then 49,800 can be the base for further selling.
| Resistance Zones:
51,000-51,200 shall act as resistance and possibly break it, then might reach 51,900.
"The Bank Nifty struggles to regain upward momentum and the bearish undertone would call for a sell-on-rise strategy, according to Puneet Singhania, Director at Master Trust Group.
| Strategy for Traders
Analysts advise cautiousness:
1. Nifty 50: Observe 23,200 support while remaining on the sell-on-rise strategy below the 24,000 level.
2. Bank Nifty: Key levels; sell close to the resistance zones at 51,000-51,200.
| Week outlook :
A gap-up opening can give temporary relief, but the overall sentiment remains bearish due to high volatility and weak technical indicators. Investors are advised to trade carefully and watch the key levels very closely.
Disclaimer: The analysis is based on technical indicators and expert opinions. Investors are advised to consult certified professionals before making any trading decisions.
