NIFTY wrapped up another very disappointing week of trade, extending its ongoing losing streak to the eighth consecutive week. The curtailed week began on a very gloomy note, with prices declining sharply on the first day itself. Although some resilience from buyers over the following two sessions pointed towards the emergence of demand at lower levels. But selling pressure intensified sharply on the final trading day, where prices declined by over 400 points intraday, only to recoup a significant portion of the losses during a subsequent intraday recovery. The index eventually settled at the 22421 mark, registering a weekly loss of 3.11%.

Despite the ongoing bear onslaught and overtly weary sentiment, prices are now approaching, or have reached, some key levels that have acted as sacrosanct support over the past two years. A rising, upward-sloping trendline that has defended prices on three previous occasions is currently placed in the 22200–22000 zone. Although prices have closed below this rising trendline today, given the number of times demand has emerged in this zone in the past, a conclusive breakdown below this support band would be required to confirm further deterioration. Until then, there remains a possibility of a similar resurgence from this zone. This support zone gains further significance on the Point & Figure charts as well. On the 1% P&F chart, the zone coincides with the lows of a bullish Anchor column that has remained active since early 2025. A break below the lows of this Anchor Column, around the 22250 band, would invalidate a major bullish setup and mark the first such breakdown since the lows recorded during the COVID period. In light of the current price location, its proximity to this sacrosanct support zone, and oversold readings across most technical and breadth indicators, we anticipate the possibility of a bounce in the coming sessions. In terms of levels, the 22200-22000 band remains an immediate and all-important support for the NIFTY. On the upside, 22550-22600 band is an immediate hurdle, followed by a stronger resistance in the 22800-22900 zone.

We highlighted the emergence of some demand in MIDCAP stocks, as indicated by the formation of a bullish candlestick setup on the daily charts. A follow-up Doji candle further underscores the presence of demand at lower levels on the MIDCAP index. Given the proximity of frontline indices to key support levels, coupled with the bullish formations emerging on the MIDCAP index, we believe it may be an appropriate time to gradually start entering the market from a larger time-frame perspective, provided strict risk management principles are followed.

Key levels to watch

NIFTY

Support: 22200- 22000

Resistance: 22550- 22600

BANKNIFTY

Support: 54000– 53800

Resistance: 55100– 55200

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