Nifty 50 tanks 12% from peak! Will bulls make a comeback or bears continue to rule? Look, what technical experts suggest | Stock Market News

Nifty technicals: The Nifty 50 index has been in a corrective phase since September 2024, marking a steep 12 per cent decline from its record high of 26,277. This downturn has been fueled by a combination of weak domestic earnings, rising foreign investor outflows, and global macroeconomic concerns.

VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted that the strengthening US dollar has pressured emerging market currencies, with the rupee hitting a record low of 86.39 against the dollar. Rising crude oil prices, with Brent crude exceeding $81 per barrel, have reignited inflation fears, further dampening investor confidence, he said. 

“FIIs have withdrawn over $4 billion from Indian equities this month, after $11 billion in outflows last quarter. Uncertainty surrounding US monetary policy and President-elect Donald Trump’s economic strategies has added to bearish sentiment, leading to increased pressure on emerging markets like India. These factors suggest continued caution is warranted as markets navigate heightened volatility,” he added.

Nifty 50 Technical Outlook

With the index trading below critical support levels, including the 200-day moving average, market analysts are evaluating potential recovery scenarios and identifying key levels that could signal a turnaround. Technical indicators suggest further caution as the index remains below critical support levels and moving averages. Market experts are analyzing the trend to predict potential recovery zones and downside risks.

Anand James, Chief Market Strategist, Geojit Financial Services

According to Anand James, Chief Market Strategist, Geojit Financial Services, the sustained decline has dragged 66 per cent of Nifty’s constituents below their 200-day simple moving averages (SMA). With Nifty now trading approximately 3.5 per cent below its 200-day SMA, James believes this environment could set the stage for a mean reversion.

He pointed out that the pullback from 23,000, a psychological support level, signals a possible recovery swing. However, challenges remain, with the consolidation near 23,176 suggesting initial hesitation. James identified 23,370 as the critical resistance level to breach for further upside, with potential targets of 23,550–23,640. Failure to clear 23,770, however, could renew selling pressure, bringing 22,800–22,260 into focus over the medium term, he warned.

Ajit Mishra SVP, Research, Religare Broking

Mishra noted that Nifty’s drop below its 200-day exponential moving average (DEMA) of 22,680 signals a negative trend. With 33 out of 50 constituents trading below their long-term moving averages, Mishra suggested that the correction is likely to persist.

He advised traders to exercise caution, utilising recovery phases to exit long positions or initiate shorts. Mishra identified immediate support at 22,700, with resistance in the 23,500–23,700 range. The oversold conditions could trigger short-term rebounds, but sustained recovery is uncertain without clear signs of a trend reversal.

Gaurav Bissa, VP, InCred Equities

Bissa highlighted the oversold momentum indicators and noted that multiple support levels have been broken recently. Bissa identified immediate support at around 23,000 and strong resistance at 23,265.

He pointed out that a close above 23,265 could trigger a bullish Wolfe Wave pattern on hourly charts, potentially driving the index toward 23,600. However, the Nifty remains vulnerable below these levels, with further downside possible if support is breached.

Sujit Modi, CIO, Share.Market

Modi emphasised the broader downtrend in Nifty, which has been trading below its 50-day and 200-day moving averages since October 2024. He attributed the volatility to economic and geopolitical factors and noted that the 22,900 level is acting as a strong support.

Modi added that the upcoming budget presentation could introduce further market fluctuations, potentially influencing sentiment in the coming days. He suggested that traders remain cautious, monitoring the 22,900 support and watching for a close above resistance levels near 23,600 to confirm any meaningful recovery.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.