Nifty Turns Bearish as Nifty Bank Loses Upside Control

Indian equity benchmarks witnessed a sharp deterioration in sentiment as Nifty decisively transitioned from a bullish to a bearish phase, weighed down by broad-based selling and weakening leadership from the banking space. The breakdown signals a clear shift in near-term market structure, with volatility and downside risks rising meaningfully.

Nifty Breakdown Signals Trend Reversal

Nifty witnessed a sharp sell-off and ended the session at 25,232.50, down 1.38%, marking a decisive breakdown from its recent consolidation phase. The daily chart printed a strong bearish candle, clearly breaking below the Darvas Box, which confirms a shift in the short-term trend and reflects aggressive selling pressure from higher levels.

The index has now slipped below all key short- and medium-term moving averages, including the 20-day, 50-day, and 100-day averages, highlighting a complete loss of trend support. Nifty is currently hovering just above its 200-day moving average near the 25,100 zone, which also coincides with the 61.8% Fibonacci retracement of the prior up-move. This confluence makes the 25,100–25,000 zone structurally critical for determining the next directional move.

The daily Supertrend has turned into a major overhead barrier, reinforcing the bearish shift. Momentum indicators continue to weaken sharply. The daily RSI has dropped toward the 29–30 zone, entering oversold territory, while the MACD remains firmly negative, with downside momentum still accelerating.

Volatility Spikes as Market Breadth Weakens

Market volatility rose sharply, with India VIX surging 7.63% to 12.73, highlighting rising uncertainty and elevated intraday swings. Market breadth remains fragile, as reflected in a weak advance–decline ratio, suggesting that selling pressure is broad-based rather than stock-specific.

Key Levels to Watch for Nifty

• Immediate support: 25,100–25,000
  A decisive breach below this zone could open the door for a deeper retracement toward 24,880.
• Immediate resistance: 25,350–25,450
  Any pullback toward this zone is likely to face selling pressure.

Until Nifty reclaims its lost moving average supports, the near-term outlook remains cautious, with volatility-driven moves expected to dominate.

Nifty Bank Enters Corrective Phase

Nifty Bank closed the session at 59,404.20, down 0.81%, after failing to sustain early strength. The index retreated sharply from the intraday high of 59,993.50 to a low of 59,283.95, forming a bearish candle with a weak close near the day’s low, reflecting fading buying interest at higher levels.

On the daily chart, the index has slipped below the VWAP near 59,550, indicating that the recent rebound has lost momentum and is now facing resistance. However, the daily Supertrend remains intact at 58,860, suggesting that the broader trend remains supportive as long as this level is defended on a closing basis.

Momentum indicators show deterioration:

• RSI has slipped to 49, moving below the neutral zone
• MACD remains in corrective territory, with a weakening histogram pointing to continued pressure

Sectorally, selling pressure was broad-based, with the PSU Bank index falling 1.31% and the Private Bank index declining 0.96%, confirming loss of leadership from the banking space.

Nifty Bank Levels & Outlook

• Immediate support: 59,300–59,250
  A breakdown below this zone could drag the index toward 59,050, followed by the Supertrend support near 58,860.
• Immediate resistance: 59,550–59,600
  A stronger hurdle is placed near 59,800.

Until Nifty Bank reclaims these resistance levels on a closing basis, the index is likely to remain in a corrective phase, with rebounds facing selling pressure rather than follow-through buying.

Conclusion

The broader market has entered a risk-off phase, with Nifty confirming a bearish trend shift and Nifty Bank losing upside leadership. Rising volatility, weakening momentum indicators, and breakdowns below key technical levels suggest that caution is warranted in the near term. Unless strong supports hold and leadership revives, the market is likely to remain volatile with a downward bias, and rallies may continue to be sold into rather than chased.