The Indian equity markets opened on a bleak note, tracking weak trends across Asian markets and a sharp surge in crude oil prices. The benchmark indices began the session with a significant gap-down opening but initially recovered from their intraday lows, trimming early losses. However, the recovery proved short-lived as selling pressure resurfaced, keeping the markets volatile throughout the session. Amid heightened choppiness, the Nifty50 index eventually settled around the 22690 zone, registering a decline of 0.54% for the day.

The broad-based sell-off has intensified market weakness, with the technical outlook shifting from cautious to bearish front. The Nifty50’s rejection near the 20-DEMA highlights persistent selling pressure, while escalating geopolitical tensions and their impact on crude oil prices continue to pose challenges for market participants. Additionally, the 14-day RSI is on the verge of a bearish crossover, which could further reinforce the ongoing corrective momentum.

On the downside, the 22600-22500 zone is expected to act as an immediate support area. A decisive breach of this crucial cushion could accelerate selling pressure, exposing the index to the next support band of 22350-22200. On the flip side, the 20-DEMA, placed around 22800-22850, remains a formidable resistance zone, followed by the crucial psychological hurdle at 23000. Given the prevailing technical setup and external uncertainties, the near-term outlook remains cautious, with a sell-on-rise strategy preferred until a meaningful improvement in market structure emerges.

Going forward, India VIX crossing the 15-mark signals heightened volatility in the near term, warranting a cautious approach. Developments on the geopolitical front will remain closely monitored, as any significant developments could act as a key catalyst in shaping the intermediate market outlook. Amid elevated volatility and prevailing uncertainties, traders are advised to avoid aggressive directional bets and maintain disciplined risk management until market conditions exhibit greater stability.

Key levels to watch

NIFTY

Support: 22600 – 22500

Resistance: 22850- 23000

BANKNIFTY

Support: 54500 – 54200

Resistance: 55300 – 55500

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