The Indian stock market began the week on a cautious note as the Nifty 50 declined on Monday, unable to conclusively surpass the key level of 25,000 points.
This signifies the continuation of two consecutive sessions with erratic and directionless price action, suggesting that the main index might be poised for a necessary period of stabilization following an impressive recent upswing.
As expiry nears and options data tighten around key levels, analysts caution that a breakout or breakdown from the current range could set the stage for a bigger move.
According to SEBI-registered analyst Mayank Singh Chandel, the daily chart has formed a bearish inside bar with a modest upper shadow, signalling indecision and mild profit-taking at elevated levels.
Chandel identifies immediate resistance at 25,000 and 25,200, which have consistently attracted selling pressure in recent sessions.
On the negative side, 24,800 is a critical support area; breaking beneath this level might lead to a more significant decline towards 24,500–24,400.
Despite the indecisiveness, the Relative Strength Index (RSI) at 63.6 still indicates bullish undercurrents.
In the derivatives space, call open interest is highest at 25,000, followed by 25,200 and 25,500, reinforcing the resistance zone.
Nevertheless, significant buying pressure appears when writing falls within the range of 24,700 to 24,900, indicating that bulls are fiercely protecting the lower boundary.
Chandel recommends that intraday traders should await a definite breakout or breakdown from the 24,800–25,200 range prior to establishing any directional trades.
He recommends that swing traders keep an eye on a daily closure above 25,200 to join the subsequent phase of the upward movement. Concurrently, options sellers could concentrate on straddles or strangles near the 25,000 level until volatility widens out.
Analyst Bharat Sharma shares this perspective. He observes that the Nifty was unable to maintain levels above 25,000 and has fallen beneath both the 20-day and 50-day EMAs on the 15-minute chart, indicating short-term weakness.
Despite this, Sharma maintains a positional bullish stance as long as Nifty holds above 24,800 on a closing basis. Should the index close below 24,800, a fresh round of analysis would be warranted to reassess the outlook.
Looking ahead, Sharma identifies a series of resistances at 25,000, 25,200, 25,300, and 25,500, all the way up to 26,000. A clear move beyond 25,100 could unlock upside momentum, but the index must reclaim the 50-EMA near 24,960 for now.
On the downside, immediate support lies between 24,920 and 24,900, followed by stronger support at the 100-EMA around 24,870. The key level to watch remains 24,800—a breakdown here would likely usher in renewed bearish pressure.
For updates and corrections, email newsroom[at]INSPIRDIGITAL[dot]com.
0 Comments