11 hours ago
The downside momentum continued in the market for the third consecutive session on Friday, with the Nifty ending 74 points lower at 24,427 amidst choppy trade.
After opening 34 points lower, the index recovered some ground in the first half of the session. However, post 12 pm, it resumed its downward trend and closed near the day’s low as selling pressure intensified towards the end.
With this, the Nifty has corrected 750 points from the recent swing high of 25,153. On a weekly basis, the index slipped 1.78%, marking its steepest fall in five months, weighed down by persistent selling at higher levels and concerns over the steep 50% US tariffs on Indian exports announced earlier in the week.
The broader markets mirrored the weakness, with the Nifty Midcap100 and Smallcap100 slipping 0.6% and 0.4%, respectively.
Among sectoral indices, Realty, Auto, and IT were the worst hit, signaling broad-based selling pressure. On the other hand, the Nifty FMCG index gained 1% on optimism ahead of the GST Council meeting scheduled for September 3-4.
In the cash market, foreign investors were net sellers on Friday, while domestic investors provided some support as net buyers.
Looking ahead, markets will keenly track Prime Minister Narendra Modi's visit to China for the SCO Summit over the weekend, his first in seven years. The four-day trip, which also includes a visit to Japan, comes as India looks to strengthen global trade ties.
Meanwhile, the US economy showed resilience as Q2 GDP growth was revised upwards to 3.3% from 3.0% earlier, supported by lower imports and strong consumer spending.
Analysts expect Indian equities to remain range-bound, with sentiment influenced by developments in India-US trade talks and India's engagements with global leaders. On Monday, markets will also react to India's Q2 GDP and US retail inflation data, released late on Friday.
What do the Nifty 50 charts indicate?
The Nifty extended its corrective phase, raising concerns of further downside.
Nagaraj Shetti of HDFC Securities said the index is nearing a crucial support zone at 24,300-24,200 (previous swing low and 200-day EMA). A decisive move below 24,200 could drag Nifty towards 24,000-23,900 in the near term. On the upside, a break above 24,700 could shift sentiment in favor of the bulls.
LKP Securities' Rupak De said the index has slipped below the 100-EMA, confirming a deeper bearish trend. Weakness may persist, potentially taking Nifty closer to the 200-DMA at 24,071. Support is seen at 24,400/24,150, while resistance is placed at 24,650.
A "sell on rise" strategy remains preferable unless Nifty crosses 24,850, De said.
With Nifty hovering near the 24,350 zone, any breakdown below this level could extend the fall towards 24,150–24,100 (200-DSMA), said Osho Krishan of Angel One.
Nandish Shah of HDFC Securities said the index is approaching its previous swing low support of 24,337. The 200-day EMA at 24,267 may act as a crucial support, while resistance levels have shifted lower to 24,572 and 24,700.
Despite oversold conditions, no signs of short covering are visible. Weakness may persist, with 24,070 (200-DMA) acting as key support and 24,700 (100-DMA) as major resistance, said Nilesh Jain of Centrum Broking.
