Market Analysts Weigh In on Potential Support Levels After Nifty Falls Below 23,400

Indian Equity Markets Extend Losing Streak for Fourth Straight Session

The Indian equity benchmark indices, Sensex and Nifty, continued their downward trend on Tuesday, marking their fourth consecutive losing session. The selling pressure was driven primarily by rising crude oil prices and the ongoing uncertainty in the West Asia conflict.

The Nifty opened lower and remained in the negative territory throughout the session, eventually settling near the day's low at 23,379.55, a decline of 436.30 points or 1.83 percent. The Sensex also plunged, closing at 74,559.24, a decrease of 1,456.04 points or 1.92 percent. During the day, it dropped as low as 74,449.50, a decline of 1,565.78 points or 2 percent.

The Nifty's slip below the key 23,400 level has led analysts to suggest that the index may now test lower support zones in the near term. According to Virat Jagad, Senior Technical Research Analyst at Bonanza, the breakdown confirms the weakness after the recent pullback rally, and the index appears headed towards the gap-fill zone of 23,080-23,100, which could act as the next major support area.

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The market structure has weakened as the index is trading below key short-term exponential moving averages, while the RSI slipping below the 50 mark indicates fading bullish momentum and increasing selling pressure. Jagad notes that the 23,080-23,100 zone remains important as gap-fill areas often attract short-covering and fresh buying interest. However, if the Nifty stabilises around these levels, a relief rally towards 23,400-23,500 cannot be ruled out. Conversely, a sustained decline below 23,080 may intensify selling pressure and drag the index towards 22,850-22,700 levels in the short term.

Ajit Mishra, SVP, Research at Religare Broking, observes that the Nifty is approaching the gap support zone near the 23,150 level after the breakdown from its earlier consolidation range. He notes that the earlier support level of 23,800 is likely to act as a strong resistance in case of any rebound.

The sectoral performance was largely negative, with realty, IT, and auto stocks emerging as the biggest laggards. However, select energy and upstream oil companies showed relative resilience amid elevated crude oil prices. The broader markets also remained under pressure, with the midcap and smallcap indices falling 2.5-3 percent.

Sectoral Performance Comparison

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