Nifty Weekly Outlook: SEBI RA Warns of Bearish Trend Unless 25,300 is Recaptured

The Nifty 50 ended the last week with a negative trend, dropping 311 points, and created a large red candle on the weekly graph.

According to SEBI-registered analyst Mayank Singh Chandel this is a clear technical indicator of buyer weakness, especially following the Nifty index could not maintain a position above the mental threshold of 25,300 and the 20-day Exponential Moving Average (EMA) on the daily chart.

For the first time in multiple weeks, the index finished under the crucial support level of 25,200, increasing the likelihood of a prolonged decline. Moreover, technical metrics like the weekly Relative Strength Index (RSI) and Stochastic Oscillator have also turned lower, moving beneath their corresponding trigger lines, signaling reduced strength and a change in outlook towards the negative side.

What to Look Forward to This Week

Chandel pointed out that the drop beneath 25,200 holds technical importance. Should the Nifty remain under this threshold, it might lead to additional declines targeting 25,000, then moving towards 24,800–24,500, which represents a key support zone formed during the May-June consolidation period.

On the other hand, any increase over 25,300 might create an opportunity for a rapid rise towards 25,500–25,800. Nevertheless, this kind of recovery would require significant trading volume and positive international influences, according to him. The index is expected to fluctuate within a broad range of 24,500–25,800, maintaining a bearish outlook as long as it stays under 25,300.

Key Levels To Watch

Chandel noted opposition at 25,300 and 25,500, while support was set at 25,000, 24,800, and 24,500.

He stated that until there is a clear closing above 25,300, the market will continue to face challenges. Chandel recommended that traders exercise caution when holding long positions and seek chances to sell during price increases near important resistance levels. From the downward perspective, 24,800 holds significance, and a break beneath this level could increase the decline.

Information indicates that retail sentiment towards the Nifty index changed to 'bearish' from 'neutral' during the previous week.

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