Break below 24,800 will take Nifty to 24,300, say experts

Sensex, Nifty close lower on Monday due to selling in IT and banking stocks and a weak trend in global markets after rating downgrade of the US by Moody's Ratings.

The benchmark equity indices closed lower on Monday, weighed by selling in IT and banking shares amid weak global cues after rating downgrade of the US by Moody's Ratings.

The Sensex fell 271.17 points or 0.33 percent to end at 82,059.42. During the day, it dropped 366.02 points to hit a low of 81,964.57. The NSE Nifty declined 74.35 points or 0.30 percent to close at 24,945.45.

"Markets languished in negative territory for major part of the trading session as weak Asian and European indices resulted in investors resorting to profit-taking in IT, capital goods and oil & gas shares," Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said.

Also Moody's downgrading US credit rating by a notch over the weekend created some sort of uncertainty amongst investors, Tapse added.

According to analysts, the Nifty is now hovering near a key support zone, and a breach below 24,800 could lead to further downside towards 24,300.

"On the daily chart, the Nifty formed a small bearish-bodied candle with a short upper shadow, suggesting persistent selling pressure throughout the session," Bajaj Broking said in a note. "The index made an intraday low of 24,916.65 and ended below the psychological 25,000 level, indicating that bears remain in control."

Technical indicators suggest that 24,800 remains an important support, followed by a stronger base around 24,700. If the index breaks below this band, it could trigger intensified selling, dragging the Nifty to the 24,500–24,300 zone, the brokerage added.

On the upside, resistance is seen at 25,000, with a stronger hurdle around 25,200. A sustained move above this could lead to a rally towards 25,500–25,700 levels. Until then, analysts advised traders to stay cautious, avoid large overnight positions, and follow strict stop-loss measures due to the ongoing global uncertainty.

Rupak De, Senior Technical Analyst at LKP Securities, said Indian markets saw a choppy session, with the Nifty and Bank Nifty moving out of sync. "IT and Oil & Gas stocks came under pressure due to profit-booking, pulling the index lower," he said.

He noted that the Nifty seems to be entering a consolidation phase, which may continue in the near term. “Unless the index reclaims the 25,000 mark, it may stay under pressure. A drop below 24,750 could open the gates for a deeper correction, while a rebound above 25,000 could fuel an upmove toward 25,250–25,350 levels,” he added.

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