NIFTY TECHNICAL OUTLOOK
Based on Market Closing on Friday, January 3, 2025
The Nifty ended the previous session at 24,004.75, registering a decline of 183.90 points or 0.76%. The downtrend is likely to persist if the Nifty breaks below the 23,950 level.
During the session, the Nifty opened positively at 24,196.40 but failed to sustain the momentum, hitting an intraday low of 23,976 before settling lower. Sector-wise, media, PSU banks, FMCG, and metals ended with gains, while IT, pharma, banks, and financial services were the primary laggards. The market breadth remained positive, with 1,408 stocks rising, 1,322 falling, and 110 remaining unchanged. Key gainers included ONGC, TATAMOTORS, TITAN, and SBILIFE, while WIPRO, HDFCBANK, TECHM, and ADANIPORTS led the losers.
From a technical perspective, momentum indicators point to a negative trend, although the Nifty is still holding above its short-term and long-term moving averages. The formation of a black candle on the daily chart, closing below the previous day's level, signals a bearish bias.
On the downside, 23,950 acts as a critical short-term support level. A breach below this level could trigger further declines today. However, if the index holds this support, a pullback rally may materialize. On the upside, immediate resistance lies at 24,100, with stronger resistance at 24,225. The index needs to break and sustain above 24,225 to revive bullish momentum.
Intraday Levels: Support: 24,000, 23,900, 23,800 Resistance: 24,100, 24,225–24,330 (15-minute charts)
Positional Trading Levels: Short-term support: 23,950–23,500 Resistance: 24,500–24,800
Conclusion: The Nifty's near-term movement will depend on its ability to hold the 23,950 support or break above the 24,225 resistance. Traders should approach with caution, keeping an eye on these critical levels for directional clarity. A sustained move above 24,225 could signal a renewed bullish trend, while a breach of 23,950 may lead to extended losses.
Bank Nifty Technical Outlook
In the previous session, Bank Nifty ended at 50,988.80, marking a significant loss of 616.75 points. From a technical perspective, momentum indicators signal a negative trend, with the index closing below its short-term moving averages. Additionally, the formation of a long black candle on the daily chart, coupled with a close near the day's low, underscores the bearish sentiment prevailing in the market.
On the downside, the index finds immediate intraday support at 50,900. If it breaches this level, the ongoing downtrend is likely to extend further. Conversely, the nearest intraday resistance is at 51,150. For any meaningful pullback rally to occur, the index must move decisively above this resistance level.
Intraday Levels: Support: 50,900, 50,700, 50,500 Resistance: 51,150, 51,400, 51,600
Positional Trading Levels: Short-term Support: 50,600–49,600 Resistance: 51,800–52,800
Conclusion: The technical indicators and price action suggest a continuation of the bearish trend unless Bank Nifty can hold above the support at 50,900. A break below this level may result in further downside. On the other hand, a sustained move above 51,150 could provide scope for a pullback rally, with further upside resistance at 51,400 and 51,600. Positional traders should remain cautious and closely monitor key levels for potential opportunities
