The Indian stock market closed the week on a negative note, with Nifty extending its losing streak for the third consecutive session on Friday. Both the Nifty and Bank Nifty ended in the red, dragged down by weakness in IT stocks following Tata Consultancy Services’ (TCS) Q1 earnings and renewed concerns over global trade disruptions sparked by fresh tariff jitters from the US President.
The Nifty 50 closed at 25,149.85, down 0.81 per cent in the final session of the week. This week, the index declined 1.22 per cent, breaching crucial support levels in the process. “The Nifty 50 closed the week breaching the crucial support zone near 25,330," said Mandar Bhojane from Choice Equity Broking.
He highlighted that the index is currently locked in a short-term corrective phase near the key support level of 25,000. "Technically, Nifty has broken below its previous swing low on the daily chart, indicating that the index is undergoing a short-term corrective phase from higher levels," Bhojane stated.
Prices are now approaching the key Fibonacci support zone near 25,000, where a potential reversal could be anticipated, given that the overall bullish trend remains intact. However, near-term sentiment appears weak.
The Relative Strength Index (RSI) for Nifty currently stands at 48.75, trending downward, suggesting the need for caution. "A close above 25,330 could reignite bullish momentum, potentially targeting 25,670–26,000.
On the downside, if 25,000 breaks decisively, the next support lies at 24,750," Bhojane attributed. Meanwhile, the Bank Nifty index ended the week at 56,754.70, registering a 0.49 per cent decline from the previous week.
"This week, the Bank Nifty index formed a bearish-bodied candle with a long upper wick and a slight lower wick, supported by consistent trading volumes," the analyst noted. He added that this pattern reflects sustained selling pressure and limited buying interest at higher levels, suggesting the possibility of a consolidation phase or mild correction in the near term.
The weekly chart showed rejection at higher levels, with the index failing to sustain above the crucial 57,000 mark. Traders are advised to remain cautious, consider a sell-on-rise approach, and maintain strict stop-loss levels to manage risks effectively amid ongoing market volatility and potential price fluctuations, said the analyst.