It was a disappointing weekly expiry for NIFTY, as buyers failed to sustain the early morning gains. Despite a higher opening and an initial attempt by buyers to push prices higher, sellers refused to relent, eventually bringing the four-session winning streak to an end. A mid-session recovery attempt helped salvage some of the lost ground, with the index eventually settling at the 23329 mark, registering a loss of 0.43%.

The formation of a Bearish Engulfing candlestick pattern following a four-day winning streak likely points towards a cessation of the short-covering move observed over the past few sessions. Alongside this a Bearish Column Reversal formation on the Point & Figure charts further confirms the possibility of a resumption of the prior downtrend. On the 30-minute chart of the index, prices have also broken below a Rising Wedge pattern, providing additional confirmation of the resumption of the prior downtrend. Going forward, there is a high probability of a retest of the recent lows. The index’s ability to attract and sustain demand on such a retest is likely to determine the subsequent course of action. That said, a move or a conclusive close above the current session’s highs or the 23500 mark is likely to invalidate the pattern and would provide stronger evidence of a potential shift in control towards buyers. In terms of levels, immediate resistance is now likely to be encountered at the 23500 mark, followed by a stronger hurdle at the 23600 level. On the flipside, the 23100–23000 band remains a sacrosanct support zone, with any sustained down move likely only once prices break below this zone convincingly.

Traders and investors should adopt a measured and cautious approach as of now and maintain light positions, as trend remains aligned to the downside. We should continue to monitor global developments, avoid aggressive positioning, and maintain disciplined risk-management practices while awaiting confirmation through sustained price strength and improving market breadth across sectors.

Key levels to watch

NIFTY

Support: 23200- 23000
Resistance: 23500- 23600

BANKNIFTY

Support: 56000– 55800
Resistance: 56680– 56750

Hitesh Rathi, Technical Analyst -Equity & Derivatives, Angel One.