Nifty faces rejection at 25,000-level for 6th time in 9 days; experts decode market breadth

Sensex, Nifty tumbled nearly 1 per cent on Tuesday, snapping the two-day rally after profit-taking.

The benchmark indices snapped a two-day winning streak on Tuesday as profit booking in banking, IT and auto counters dragged the market lower. The Sensex tumbled 624.82 points, or 0.76 percent, to close at 81,551.63 after swinging over 1,000 points during the day. The broader Nifty declined 174.95 points, or 0.70 percent, to settle at 24,826.20.

The Nifty once again failed to sustain above the key psychological mark of 25,000, facing resistance at that level for the sixth time in the past nine sessions. The index had briefly crossed the milestone in early trade, riding on positive cues from global markets and momentum carried from Monday’s rally, but selling pressure emerged at higher levels, pulling it below the 25,000-mark by the close.

"Support for Nifty is seen near 24,700, while immediate resistance remains at 25,000–25,150. A close above 25,200 could trigger fresh buying interest, possibly taking the index towards 25,600 and 25,800 levels," said Mandar Bhojane, Equity Research Analyst at Choice Broking. "In the absence of a decisive breakout, the market is likely to remain range-bound, and traders should stay cautious," he added.

According to analysts at Bajaj Broking, Nifty formed a bearish candle on Tuesday, reflecting profit-taking after an attempt to breach the 25,000-mark. The index failed to surpass Monday’s high of 25,079 and slipped to an intraday low of 24,704. The index has now been consolidating in a broad range of 24,400 to 25,200 over the last 11 trading sessions.

"Dips towards 24,700-24,650 could offer a buying opportunity. The broader support zone is placed at 24,400–24,500, which coincides with the 20-day EMA and the recent breakout levels," Bajaj Broking said in a note.

Meanwhile, the Bank Nifty index, too, remained under pressure and formed a second consecutive high wave candle, signalling ongoing consolidation with a mild corrective tone. The index tested the upper end of its four-week consolidation band at 55,800–56,000 but failed to register a breakout.

"Unless Bank Nifty decisively moves past 56,000, it is likely to continue consolidating in the 56,000–53,500 range," Bajaj Broking noted.

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