NIFTY TECHNICAL OUTLOOK

Based on Market Closing on Tuesday, December 17, 2024

The Nifty ended the session at 24,336.00, registering a decline of 332.25 points or 1.35%. A continuation of the downtrend is likely if the index falls below the critical level of 24,300.

During the session, the Nifty opened on a negative note at 24,584.80 and maintained a downward trajectory throughout the day. The index hit an intraday low of 24,303.40 before closing at 24,336.00. Most sectors ended in the red, except for media. Major losers included PSU banks, metals, auto, and financial services.

Market breadth was significantly negative, with 893 stocks advancing, 1,789 declining, and 139 remaining unchanged. Among Nifty constituents, all stocks except CIPLA closed in the red. The top losers were SHRIRAMFIN, GRASIM, BHARTIARTL, and HEROMOTOCO.

Technical Analysis

From a technical perspective, momentum indicators suggest a positive trend; however, the index closed below its short-term moving averages. Additionally, the Nifty formed a long black candle on the daily chart and closed lower than the previous day’s close, signaling a potential continuation of the downtrend. On the downside, the index has immediate support at 24,300. A breach of this level could extend the decline in the coming sessions. On the upside, 24,500 serves as the nearest resistance. A decisive close above this level is essential to reverse the bearish sentiment.

Key Levels

Intraday Levels: Support: 24,300, 24,200, 24,100 Resistance: 24,700, 24,800-24,900 (15-minute charts)

Positional Levels: Support: 23,800, 23,300 Resistance: 24,500, 25,000

Conclusion

The Nifty’s negative close, coupled with weak market breadth, suggests that caution is warranted in the near term. Traders should closely monitor the key support level of 24,300, as a break below this could lead to further downside. On the other hand, a sustained move above 24,500 might signal the beginning of a recovery. Until then, the market is likely to remain under pressure, and short-term strategies should be aligned with the prevailing downtrend.

BANK NIFTY TECHNICAL OUTLOOK

In the previous session, Bank Nifty closed at 52,834, recording a loss of 746.55 points. From a technical standpoint, momentum indicators hint at a positive trend; however, the index ended below its short-term moving averages. Additionally, the formation of a long black candle on the daily chart, coupled with a close significantly lower than the previous day, underscores a prevailing negative bias.

On the downside, 52,750 serves as critical short-term support. A breach of this level could lead to a continuation of the downtrend in the coming sessions. On the upside, the nearest intraday resistance stands at 53,050.

Key Levels Intraday Levels: Support: 52,725, 52,400, 52,100 Resistance: 53,050, 53,340, 53,650

Positional Levels: Support: 52,750–51,750 Resistance: 53,850–54,500

Conclusion

Bank Nifty's technical indicators and bearish candlestick pattern signal caution for traders. A move below 52,750 could accelerate the downtrend, while a break above 53,050 might provide temporary relief. Positional traders should align their strategies with the prevailing trend, keeping a close eye on the defined support and resistance levels.