Trading Plan: Can bears push Nifty 50, Bank Nifty below 50-day EMA amid ongoing consolidation?

Nifty Trading Plan for July 21

The Nifty 50 corrected for another session and slipped below the psychological 25,000 mark on July 18, while the Bank Nifty broke the 56,600 support seen in previous weeks and fell more than the benchmark Nifty 50. According to experts, if the Nifty breaks 24,900 support (which coincides with the 50-day EMA and the lower line of the Bollinger Bands), the selling pressure may pull it down to 24,700. However, in case of a rebound, 25,100–25,200 are the levels to watch. Meanwhile, if the Bank Nifty breaks 55,900 support (50-day EMA), the bears may gain more strength and drag the index toward 55,500, followed by the June low (55,149). On the higher side, 56,600–56,700 is expected to act as a resistance zone.

On July 18, the Nifty 50 slipped 143 points (0.57 percent) to 24,968, while the Bank Nifty closed at 56,283, down 546 points (0.96 percent), with weak market breadth. About 1,713 shares declined, compared to 938 advancing shares on the NSE.

Nifty Outlook and Strategy

Osho Krishan, Chief Manager - Technical & Derivative Research at Angel One

The benchmark index Nifty 50 declined for the third consecutive week, ultimately falling below the 25,000 threshold, thereby recording a decrease of 0.7 percent over the week. The index has broken down from its ‘Rising Channel’ structure on the daily time frame and is currently positioned close to its 50-DEMA, re-entering a previously established consolidation zone characterized by fluctuating price levels.

If the index experiences any further decline below the 24,900 zone (50-DEMA), it could potentially lead to a significant downturn, dragging it toward the critical support level of 24,700 in the upcoming trading sessions. On the upside, the 20-DEMA, situated around 25,200–25,250, presents a formidable resistance barrier. Until the index achieves a sustained breakout beyond this resistance, it is likely to remain trapped within the identified range, exhibiting a negative bias as market participants remain cautious.

Key Resistance: 25,200, 25,250

Key Support: 24,900, 24,700

Strategy: Sell Nifty Futures below 24,900, with a stop-loss of 25,050, and book profits near 24,700–24,600.

Rajesh Palviya, SVP- Research (Head Technical & Derivatives) at Axis Securities

On the weekly chart, the Nifty 50 formed a lower high–lower low pattern, signalling a continued profit-booking phase that began two weeks ago. Nifty stayed below the 20-day SMA (25,318) all week, indicating continued weakness. Sustained trade below this level may lead to 24,750–24,500, while a breakout above it could revive positive momentum. A move above 25,250 may trigger buying towards 25,350–25,600, while a break below 24,900 could lead to selling pressure toward 24,750–24,500.

For the coming week, the index is likely to trade within a broad range of 25,600–24,500 with a negative bias. Momentum indicators reflect caution: the weekly RSI has flattened in the overbought zone, indicating weakening strength, while the Stochastic oscillator has turned negative, reinforcing a bearish undertone.

Key Resistance: 25,100, 25,250

Key Support: 24,800, 24,650

Strategy: Sell Nifty Futures around 25,150 with a stop-loss of 25,250, targeting 24,850–24,700.

Anshul Jain, Head of Research at Lakshmishree Investment

Nifty closed below the previous week’s low, invalidating the bullish fair value gap — a clear signal that bulls are exhausted and the index now needs fresh liquidity before any meaningful upmove. On the daily chart, key liquidity lies at the swing low of 24,733. Minor support exists at the 50-day EMA around 24,932, but a breach below that will likely drag the index toward the liquidity zone.

On the upside, any rally will face stiff resistance in the 25,080–25,120 zone. With two consecutive closes below the weekly bullish fair value gap, the short-term trend has turned bearish. Expect continued profit booking and a potential retest of lower levels, unless strong buying emerges near support.

Key Resistance: 25,080, 25,120

Key Support: 24,870, 24,733

Strategy: Sell Nifty Futures on rallies towards the 25,080–25,120 zone for an immediate downside to 24,870.

Bank Nifty - Outlook and Positioning

Osho Krishan, Chief Manager - Technical & Derivative Research at Angel One

Technically, the Bank Nifty has now broken below a rising wedge pattern on both the daily and weekly charts. This, coupled with a breach of the 20-DEMA, underscores the growing bearish sentiment in the rate-sensitive index. With this breakdown, the likelihood of a deeper retracement has increased significantly, with an initial retest of the 55,500–55,000 zone on the cards.

A sustained move below this band could open the doors for a further decline toward the 54,500 level. Given the bearish outlook, participants are advised to refrain from taking aggressive long positions until clear signs of a trend reversal emerge.

In terms of levels, the previous support at 56,600 is now likely to act as immediate resistance, followed by a stronger hurdle in the 57,250–57,400 zone. On the flip side, immediate support is seen in the 56,000–55,900 band, which aligns with the 50-DEMA, followed by a stronger support zone between 55,400 and 55,100.

Key Resistance: 56,600, 57,250

Key Support: 55,500, 55,000

Strategy: Sell Bank Nifty Futures around 56,500 for a potential target of 55,500, with a stop-loss of 57,000.

Rajesh Palviya, SVP- Research (Head Technical & Derivatives) at Axis Securities

Bank Nifty posted a weekly loss of 472 points. On the weekly chart, the index formed a small bearish candle with a long upper shadow, reflecting persistent selling pressure at higher levels. It closed below both the 20-day SMA (56,929) and the key support zone of 56,500, suggesting underlying weakness. A decisive close above the 20-SMA is essential to shift the outlook to positive.

From a pattern perspective, sustained trading above 56,700 could trigger buying interest, paving the way for an upside move toward 57,000–57,500. Conversely, a break below 56,000 may invite further selling pressure, dragging the index toward 55,500–55,000 levels. For the week ahead, we expect Bank Nifty to trade within a broad range of 55,000–57,500 with a negative bias. The weekly RSI has slipped below its signal line, reinforcing a cautious undertone and signalling a loss of bullish momentum.

Key Resistance: 56,450, 56,650

Key Support: 56,050, 55,850

Strategy: Sell Bank Nifty Futures around 56,400 with a stop-loss of 56,600, targeting 56,050–55,800.

Anshul Jain, Head of Research at Lakshmishree Investment

Bank Nifty has closed below the weekly bullish fair value gap for the second consecutive week — a strong indication of a short-term bearish reversal. The index is showing clear signs of weakness and likely needs to sweep downside liquidity before any sustainable upmove resumes.

On the daily chart, Bank Nifty has already filled the gap near 56,250 and closed right at that level, reinforcing bearish pressure. A breach and sustained move below 56,200 will likely trigger further downside, targeting the swing low liquidity zone around 55,475.

On the upside, any relief bounce will face strong resistance near the 56,600 level. Until that’s reclaimed decisively, the bias remains negative, with further selling pressure expected on breakdowns.

Key Resistance: 56,600, 57,000

Key Support: 56,200, 55,800

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