Trading Plan: Can Nifty 50 break 25,000, Bank Nifty fall below 57,000 amid consolidation?

Nifty Trading Plan for July 25

The Nifty 50 and Bank Nifty saw selling pressure after a day of rally. The Nifty 50 could not hold on to short-term moving averages, signaling weakness. Until the index trades below the 25,250–25,300 zone, consolidation may continue, with support at 25,000. If it breaks below this, 24,900 is the level to watch. Meanwhile, the Bank Nifty sustained above short-term moving averages, but if follow-through selling occurs and the index breaks the 20-day EMA (56,800), the correction may widen. On the higher side, the 57,300–57,350 zone is the level to watch, experts said.

On July 24, the Nifty 50 fell 158 points to 25,062, while the Bank Nifty corrected 144 points to 57,066, amid weak market breadth. About 1,721 shares declined compared to 921 advancing shares on the NSE.

Nifty Outlook and Strategy

Dhupesh Dhameja, Derivative Research Analyst, Samco Securities

Nifty remained trapped within a narrow band of 24,900–25,300, lacking clear directional bias amid frequent sector rotations and weak follow-through buying. The index continues to face stiff resistance at 25,200–25,300, where aggressive Call writing persists, while 25,000 holds as key support with significant Put open interest. The RSI hovering below 50 signals muted momentum. The 20- and 50-day EMAs, placed at 25,150 and 24,950 respectively, further define the consolidation zone. Until a decisive breakout above 25,300 unfolds, market sentiment will likely stay cautious, and a sell-on-rise strategy remains ideal as resistance continues to dominate short-term trade dynamics.

Key Resistance: 25,250, 25,300, 25,500

Key Support: 25,000, 24,850, 24,700

Strategy: Traders can execute a Bear Call Spread strategy for the July 31 expiry by buying one lot of 25,050 CE at Rs 143 and selling one lot of 24,900 CE at Rs 241. This setup is designed to capitalize on a potential downside move while limiting upside risk.
Stop-Loss: Hold the strategy until expiry, with the maximum Mark-to-Market (MTM) loss capped at Rs 3,874.
Target: Hold the strategy until expiry to achieve a maximum profit of Rs 7,376, or consider booking profits once the MTM gains exceed Rs 5,000.

Jay Mehta, Technical Research at JM Financial Services

The Nifty index currently trades above the psychological 25,000 level, supported last Friday at the 50-day EMA and a key Fibonacci retracement at 24,930. July’s price action reveals intense selling pressure, with larger candlestick ranges on down days versus up days, signaling weakness in the short-term structure. The RSI dips below 50, and the MACD shows a negative crossover and is approaching the centerline, indicating further consolidation or profit-taking in the near term. The broader range is 24,410–25,410, with a short-term range of 24,900–25,300. A decisive break below 24,900 could trigger a drop to 24,700 or 24,460, while sustaining above 25,410 is critical for a bullish view.

Key Resistance: 25,300, 25,460

Key Support: 25,000, 24,900, 24,700

Strategy: Adopt a range-trading approach — sell when the price approaches 25,300–25,350, setting a stop-loss at 25,410. For a bearish strategy, watch for a breakdown below 24,900, targeting 24,700 and 24,500, with a stop-loss at 25,000. For very short-term or intraday trades, buy on dips near 24,900, with a stop-loss at 24,860.

Hardik Matalia, Derivative Analyst at Choice Broking

The Nifty 50 index witnessed selling pressure and formed a Bearish Engulfing candlestick pattern on the daily chart, indicating a potential short-term reversal. The index made multiple attempts to surpass its short-term 20-day EMA but failed to sustain above it. However, it continues to hold above its medium-term 50-day EMA, suggesting that the broader trend remains intact. On the downside, immediate support is placed at the 25,000 mark, followed by 24,900. A decisive breach below these levels could attract further selling pressure.

On the upside, 25,150 is the first hurdle, followed by a crucial resistance zone in the 25,250–25,400 range. Sustaining above this zone is essential for any continuation of upward momentum. Until the index holds above 25,000, a buy-on-dips strategy can be considered, but with a cautious approach and strict stop-losses amid ongoing volatility.

Key Resistance: 25,150, 25,250

Key Support: 25,000, 24,900

Strategy: Buy Nifty Futures on dips near the 25,000 level for a target of 25,250–25,400, with a stop-loss of 24,900 on a closing basis.

Bank Nifty - Outlook and Positioning

Dhupesh Dhameja, Derivative Research Analyst, Samco Securities

The Nifty Bank index remained directionless, oscillating within the 56,600–57,350 band, as resistance near 57,300 capped upside attempts. Despite a minor late recovery, there was no follow-through to the previous short-covering, reflecting continued bearish pressure. The 20-day EMA around 56,800 and the strong base at 56,600 remain crucial support zones. Aggressive Call writing near 57,300 suggests traders are selling into rallies. With the RSI below 50 and no clear trend, sentiment remains cautious. Until a breakout above 57,350 is seen, a sell-on-rise approach remains ideal, with sellers retaining control below key resistance levels.

Key Resistance: 57,350, 57,500, 57,750

Key Support: 56,950, 56,800, 56,600

Strategy: Traders can execute a Bear Call Spread strategy for the July 31 expiry by buying one lot of 57,100 CE at Rs 328 and selling one lot of 56,800 CE at Rs 508. This setup is designed to capitalize on a potential downside move while limiting upside risk.
Stop-Loss: Hold the strategy until expiry, with the maximum Mark-to-Market (MTM) loss capped at Rs 4,395.Target: Hold the strategy until expiry to achieve a maximum profit of Rs 6,104.

Jay Mehta, Technical Research at JM Financial Services

Bank Nifty experienced a bearish breakdown from a rising wedge pattern last Friday, marked by a gap-down, though it recovered on Monday by filling the gap and attempting to re-enter the wedge. However, the index struggles to surpass the resistance zone of 57,300–57,370. Negative divergence persists on the daily RSI, suggesting continued consolidation and some profit booking in the near term. A bullish confirmation requires the RSI to exceed 68 and the price to break above 57,630. The medium-to-long-term outlook remains positive, but the short-term perspective is neutral to mildly bearish. Bank Nifty demonstrates relative strength compared to Nifty.

Key Resistance: 57,370, 57,630

Key Support: 56,690, 56,500, 56,000

Strategy: For a conservative long approach, await a breakout above 57,630 with RSI above 68 before entering long positions. For a sell-on-rise strategy, sell near 57,300–57,370 with a stop-loss at 57,450. Alternatively, for a bearish setup, monitor a breakdown below 56,690, targeting 56,500 and 56,250, with a stop-loss above 56,800.

Hardik Matalia, Derivative Analyst at Choice Broking

The Bank Nifty index faced rejection from higher levels and formed a bearish-bodied candlestick with a lower wick on the daily chart, indicating selling pressure at the top while still finding some support at lower levels. Notably, the index continues to hold above all its key moving averages — short-term (20-day), medium-term (50-day), and long-term (200-day) EMAs — which reflects underlying strength in the broader trend.

On the downside, immediate support is seen at the 57,000 mark, followed by the 56,700–56,500 zone. A breach below these levels could invite further weakness. On the upside, 57,300 is the immediate resistance, with a crucial hurdle placed near the 57,500 level. A decisive move above this mark is necessary for bullish momentum to resume. Until the index holds above 56,500, a buy-on-dips approach is advisable, with traders maintaining a cautious stance and using strict stop-losses amid ongoing volatility.

Key Resistance: 57,300, 57,500

Key Support: 57,000, 56,700

Strategy: Buy on dips near 56,700 levels for a target of 57,300–57,500, with a stop-loss of 56,500 on a closing basis.

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