Trading Plan: Will Nifty sustain below 23,000, Bank Nifty manage to defend 49,000?

Nifty Trading Plan

The Nifty 50 and Bank Nifty were under pressure on February 14, forming a bearish candlestick pattern on the daily charts and trading below all key moving averages with a negative bias in momentum indicators, signaling weakness. Hence, if the index fails to defend 22,750 on a closing basis, a sharp correction toward 22,500 cannot be ruled out. However, if it rebounds, the hurdle lies at 23,000, followed by 23,300, according to experts. The Bank Nifty needs to hold on to 49,000 on a closing basis for a move toward the 49,400–49,800 zone. If it falls below this level, 48,700 could act as immediate support, followed by around 48,300.

On Friday, February 14, the Nifty 50 dropped 102 points to finish at 22,929, and the Bank Nifty declined 260 points to 49,099, with weak market breadth. A total of 2,262 shares saw a correction compared to 340 shares rising on the NSE.

Nifty Outlook and Strategy

Osho Krishan, Senior Analyst - Technical & Derivative Research at Angel One

The setup in the market last week (ended February 14) raises considerable concerns regarding uncertainty among participants. As we observe the price action testing both the swing low and the lower boundary of the 'Falling Wedge' pattern, it indicates a bearish sentiment in the market. If a breakdown occurs, it could trigger a significant sell-off, leading to increased volatility and further downward movement in asset prices.

From a technical standpoint, any decisive breakdown below the 22,800-22,700 zone (lower band) could open up fresh room for a decline toward 22,500-22,400 in the near term, potentially a drop of nearly 15 percent from the all-time high. On the flip side, a series of resistances could be seen, starting from 23,300-23,350 (20 DEMA & neckline of the breakdown), followed by 23,500 (upper band of the Wedge). Only a breach of these levels could provide some relief for market participants.

On the options front, scattered positioning of open interest has been observed from 23,000-23,300 strike Calls, indicating nearby resistance.

Key Resistance: 23,300, 23,350, 23,500

Key Support: 22,800, 22,700, 22,500, 22,400

Strategy: Buy Nifty Futures on dips around 22,800, with a stop-loss of 22,500, and book profits near 23,300.

Ameya Ranadive, CMT, CFTe, Senior Technical Analyst at StoxBox

The Nifty lost 630 points (2.68%) during the last week, indicating strong bearish sentiment. Persistent selling pressure at 23,500 has created a significant resistance zone, while 22,750-22,800 has emerged as critical support, successfully holding twice last week. FIIs’ aggressive short positions, with 84.13% bearish exposure, amplify the selling pressure. Options data shows 23,500 as the highest Call resistance, while Put support was seen at 22,500 and 22,800. Technically, the Nifty is below the 20, 50, 100, and 200-day EMAs (exponential moving averages), with a negative MACD (moving average convergence divergence) crossover and weak RSI (relative strength index), indicating continued weakness.

Key Resistance: 23,150, 23,300

Key Support: 22,750

Strategy: Adopt a wait-and-watch approach as Nifty is at a crucial juncture. Await clarity before initiating trades.

Bank Nifty - Outlook and Positioning

Osho Krishan, Senior Analyst - Technical & Derivative Research at Angel One

The Bank Nifty remains at a critical juncture, with 49,700–50,000 serving as a key resistance zone, while 48,800–48,700 remains an immediate support band. A breakdown below this support could accelerate downside momentum, potentially leading to a retest of the 47,800 level. Conversely, a strong recovery above resistance could shift control back to buyers.

For the past few weeks, the index has consolidated within the range of the substantial down-bar from early January, highlighting the sideways nature of the immediate trend. Given this, participants should adopt a wait-and-watch approach and monitor for a decisive breakout beyond these levels. However, the failure of buyers to hold the 49,500–49,650 short-term breakout zone raises concerns for bulls. If a swift rebound does not materialize early next week, sellers are likely to take control and drive the index toward recent swing lows.

On the options front, decent piling of open interest was observed at the 50,000 strike Call and the 48,500 strike Put, indicating an intermediate range.

Key Resistance: 49,700, 50,000

Key Support: 48,700, 47,800

Strategy: Buy Bank Nifty Futures around 48,700, with a stop-loss of 48,400, targeting 49,700.

Ameya Ranadive, CMT, CFTe, Senior Technical Analyst at StoxBox

The Bank Nifty dropped 2.11% last week, with the index failing to sustain above the critical 50,000 mark. Persistent weakness is evident as both the daily and weekly RSI remain subdued, hovering below 45, reflecting a lack of buying strength. Despite this weakness, 48,500 has emerged as a robust support zone, holding firm for the past month, providing a base for potential recovery. On the upside, a decisive move above 49,800, with two consecutive daily closes, is essential to signal a shift toward a bullish structure and negate the prevailing downtrend. The MACD histogram is diverging further below the zero line, indicating continued selling pressure and a lack of momentum.

Key Resistance: 49,500, 49,800

Key Support: 48,500

Strategy: A buying opportunity exists near 48,800-48,750, given proximity to strong support. Targets are 49,400 and 49,800, with a stop-loss below 48,350.

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