Bears may Gain Momentum if Nifty Index Falls Below Budget-Day Low; US-Iran Tensions Contribute to Nine-Month High in VIX, 59,000 Threshold Crucial for Bank Nifty Weakness Continuation
Nifty 50 and Bank Nifty Update
Market Performance
The Nifty 50 index fell 2.2 percent intraday, moving closer to the Union Budget day's low of 24,600. The index dropped below the lower Bollinger Bands and the 200-day EMA, with momentum indicators signaling a severely bearish trend. However, a recovery of more than 250 points from the day's low was observed.
The index opened at 24,659 with a loss of more than 2 percent but rebounded to near 25,000. After an hour of volatility, the index succumbed to selling pressure again and touched an intraday low of 24,603 in the afternoon. It closed at 24,866, down 313 points (1.24 percent).
Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data
Technical Analysis
The Nifty 50 formed a bullish candle on the daily charts due to the recovery but needs to fill the bearish gap for bulls to regain control. Key support is placed at 24,600, and a decisive break below this level could extend the decline toward 24,200. Immediate resistance is seen at 25,000, and a break above this level could trigger short covering toward the 25,200 mark.
Market Sentiment
Momentum indicators and oscillators have already flashed a sell crossover, indicating a weak underlying tone. The RSI declined to 35.48, while the MACD remained well below the zero line, with further downside visible in the histogram. The India VIX spiked 25.01 percent on Monday to 17.13, the highest closing level since June 2, 2025, signaling major risk for bulls.
Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline
Bank Nifty Update
The Bank Nifty also showed a smart recovery of nearly 700 points, or over 1 percent, from the day's low of 59,148 to close with a loss of 689 points (1.14 percent) at 59,840. This indicates that it recouped nearly half of the day's losses and climbed back above the 50 percent Fibonacci retracement level. It also defended the falling trendline on a closing basis but failed to move back above the 50-day EMA.
Key Levels
- Nifty 50: Support at 24,600, Resistance at 25,000
- Bank Nifty: Support zone of 59,400-59,300, Resistance at 60,300-60,400
Investor Takeaway
Investors should be cautious of potential market weakness if the Nifty Index falls below the 24,600 level.
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