Nifty Consolidates: Key Levels to Watch Amidst Weekly Decline

The Nifty index registered another week of losses, extending its losing streak despite a recovery in Friday’s penultimate session. Closing at 24,252, the index saw a 0.47% weekly decline, though it gained 0.08% on Friday, indicating consolidation within a narrow range.

Key Market Movements

• Nifty closed at 24,252, down 0.47% weekly.
• Friday saw a marginal gain of 0.08% for the Nifty.
• Top gainers among Nifty 50 constituents: Power Grid, HDFC Life, and Nestlé.
• Major laggards: Trent, Maruti Suzuki, and IndiGo.
• Sectoral trends were mixed, with Metals, Private Banks, and Realty ending higher.
• Auto, Media, and IT sectors were among the biggest decliners.

The broader market, encompassing the Nifty Midcap 100 and Nifty Smallcap 100, notably outperformed the benchmark Nifty 50. Market participants anticipate the Nifty to remain largely sideways, with a potential for a marginal recovery following two consecutive weeks of losses.

Technical Analysis and Key Levels

Technical analysts offered varied perspectives on the index’s trajectory. Nagaraj Shetti of HDFC Securities maintained that the Nifty’s underlying trend remains positive.

• Shetti forecasts a potential move towards 24,500-24,600 next week.
• Immediate support is identified at 24,100.

Vinay Rajani, also from HDFC Securities, noted the Nifty sustained above its 50-day and 100-day Exponential Moving Averages (EMAs) around 24,200. However, it remained below the 20-day EMA (24,300) and 200-day EMA (24,376).

• Rajani suggests a choppy, momentum-less near-term structure.
• A decisive close below 24,000 would confirm a bearish trend resumption.
• A sustained move above 24,400 is needed for a short-term bullish reversal.

Rupak De of LKP Securities assessed the overall sentiment as sideways to mildly positive. He identified 24,200 as immediate support and 24,350 as immediate resistance.

Bank Nifty’s Trajectory

The Bank Nifty traded within a 290-point range on Friday, reflecting similar consolidation. Sudeep Shah of SBI Securities outlined critical levels for the banking index.

• Immediate resistance for Bank Nifty is in the 58,200-58,300 zone.
• A sustained move above this could extend a pullback towards 58,700 and then 59,000.
• Immediate support for Bank Nifty is placed at 57,300-57,200.

Key factors such as monsoon progress, Foreign Institutional Investor (FII) flows, crude oil prices, and broader macroeconomic developments are expected to drive market action through sector-specific opportunities in the coming period.