The Indian equity markets witnessed a corrective week, with persistent selling pressure weighing on the benchmark indices. While the intensity of the decline remained moderate, sustained weakness was evident, particularly across the broader market segments. The Nifty50 index ultimately ended the week on a subdued note, declining 0.83% from the previous week’s close and settled at 24366. The overall market tone remained cautious amid continued selling pressure and lack of conviction at lower zones.

Following the Doji formation in the previous week, a sense of hesitation became evident, while the persistent sell-off gradually turned the market undertone cautious and skeptical. On the daily chart, the benchmark index has been hovering around its 20 DEMA over the past few sessions, reflecting indecisiveness among market participants.

Technically, the index has retraced 38.20% of its recent rally, which also coincides with the breakout neckline of the sloping trendline, suggesting that the current decline remains a healthy retracement. However, a sustained move below the weekly low of 24265 could weaken the technical structure and shift the outlook from cautious to bearish. Such a breakdown may expose the index to key support zones of 24200-24150, aligned with the 50% Fibonacci retracement, as well as the 50 and 100 DEMA for the coming week.

Conversely, a decisive and sustained move above 24500 is likely to reinforce the underlying structure, potentially triggering a bullish reversal and resumption of the primary uptrend, eyeing for 200 DSMA at 24730. Hence, market participants should remain watchful for key developments and potential catalysts that could determine the next directional move, while positioning accordingly.

Going ahead, it would be prudent to avoid aggressive positioning until greater clarity emerges on the market trend, while maintaining disciplined risk management. Investors should closely monitor domestic and global developments that could act as key catalysts in shaping the intermediate trend and accordingly adjust their strategies as market conditions evolve.

Key levels to watch

NIFTY

Support: 24265 – 24150

Resistance: 24500 -24730

BANKNIFTY

Support: 57200 – 56800

Resistance: 57900 – 58250

Osho Krishan, Chief Manager – Technical & Derivative Research, Angel One.