Is Nifty Entering a Critical Demand Zone Between 25,000 and 24,770?

Mumbai, July 19 (NationPress) The Indian equity benchmarks concluded the week on a downtrend, as the Nifty dipped below the 25,000 threshold. The Sensex finished down 501.51 points at 81,757.73, while the Nifty lost 143.05 points to close at 24,968.40 during the final trading session of the week.

Global indicators remained volatile due to escalating crude oil prices amidst disruptions in Iraq and ambiguous signals regarding the U.S. Federal Reserve's interest rate strategy, raising inflation concerns for oil-importing nations like India.

"On the weekly chart, the Nifty has produced three consecutive bearish candles from recent peaks, signifying a decline in upward momentum," stated Mandar Bhojane, Senior Technical Analyst at Choice Equity Broking Private Limited.

From a technical standpoint, the Nifty has now entered a significant demand zone between 25,000 and 24,770, which is anticipated to serve as immediate support.

A bullish reversal from this zone could trigger a new rally towards levels of 26,000 and 26,400 in the coming weeks, and despite the price correction, declining volume indicates that the downturn lacks aggressive selling pressure, suggesting that the overall trend structure remains bullish, according to Bhojane.

Most sector indices closed in the negative, with the banking, energy, and FMCG sectors leading the losses, while broader markets also experienced profit-taking with nearly a 1 percent correction.

"As we enter the upcoming week, earnings reports from major players like HDFC Bank and ICICI Bank will be crucial indicators for market direction," added Bhojane.

Traders are advised to exercise caution and seek confirmation signals before executing trades; the index is showing support levels between 24,900-24,800 and resistance levels between 25,200-25,500, as noted by the analyst.

Meanwhile, the Bank Nifty index concluded at 56,283, marking a 0.83 percent decline from the prior week's close due to selling pressure linked to earnings reports.

This selling pressure indicates a possible pause in the ongoing uptrend, pointing towards a likely sideways to bearish or consolidation phase in the near term.

"As long as the index remains below the 57,000 mark, a 'sell on rise' strategy is advisable, with downside targets set at 56,000 and 55,500," Bhojane emphasized.

On the weekly timeframe, the Bank Nifty is trading above all its key moving averages—including the short-term 20-day, medium-term 50-day, and long-term 200-day Exponential Moving Averages (EMA)—indicating an overall uptrend.

The index is expected to encounter substantial resistance within the 56,500–57,000 range. For the ongoing expiry, put options reveal the highest concentration near the 56,000 and 55,500 strikes, marking these as critical support levels, according to the analyst.