The Nifty 50 continued its southward journey, forming a lower highs–lower lows pattern for the second consecutive session on July 18, falling nearly six-tenths of a percent. The index not only broke the psychological 25,000 mark but also tested the 50-day EMA (24,900) support intraday, with above-average volumes, signaling that bears may be gradually gaining strength.
Further, the index broke two upward-sloping support trendlines in a single session. Momentum indicators also weakened further—RSI declined to 43.07, and the MACD maintained its bearish crossover, with additional weakness in the histogram. The Stochastic RSI, which was sideways recently, also showed a negative crossover. All these technical indicators signal more weakness ahead.
If the index decisively breaks below 24,900, the 24,800–24,700 zone (representing the lows of previous large bullish candles on the weekly basis) becomes the next support area to watch, followed by 24,500, which remains a crucial support zone. On the higher side, however, the index needs to reclaim and sustain above 25,000 to resume its upward journey, according to experts.
The Nifty 50 opened flat and touched an intraday high of 25,145, but failed to sustain those opening gains. Selling pressure intensified as the day progressed, dragging the index to a low of 24,919, before it closed at 24,968, down 143 points, forming a bearish candle on the daily chart.
The recent swing high of 25,255 can now be considered the new lower top in the pattern. On the weekly chart, the Nifty formed a bearish candle (down 0.72%), its third consecutive bearish candle, continuing the pattern of lower tops–lower bottoms for the second straight week.
According to Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, the underlying trend of Nifty remains weak.
“A slide below 24,900 levels could open more weakness down to 24,500 in the coming week. However, any pullback rally from here could face strong overhead resistance around 25,250,” he said.
Weekly options data indicates that the Nifty may trade in the 24,500–25,500 range in the short term, while 24,900–25,200 is the immediate range to monitor.
The maximum Call open interest was at the 25,200 strike, followed by 25,100 and 25,500, with maximum Call writing at 25,100, then 25,000 and 25,200.
On the Put side, 24,900 held the maximum open interest, followed by 25,000 and 24,500, with maximum Put writing at 24,900, then 24,950 and 25,000. Bank Nifty
The Bank Nifty underperformed the benchmark Nifty 50, falling 546 points (0.96%) to close at 56,283, forming a bearish candle with an upper shadow on the daily timeframe. The index dropped sharply below the 20-day EMA and also broke the 56,600 support. On the weekly chart, it declined 0.83%, forming a negative candle with a long upper shadow, indicating selling pressure at higher levels.
A key technical observation lies in the daily RSI behaviour. Despite a mid-week pullback, the RSI failed to surpass the 60 level, a bearish sign as per RSI range shift principles. Currently, the RSI stands at 45, its lowest level since March 2025, reflecting a notable loss of momentum and increasing trend weakness.
Looking ahead, the 50-day EMA zone of 55,950–55,850 will act as the immediate support. A breach below 55,850 could expose the index to the next crucial support at 55,300, according to Sudeep Shah, Head – Technical and Derivative Research at SBI Securities.
"On the upside, the 20-day EMA zone of 56,700–56,800 will act as an important hurdle for the index," he added.
Meanwhile, the India VIX, the market's fear gauge, rose by 1.33% to 11.39, indicating complacency among participants. However, traders should stay alert for any major swings on either side.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
