The Nifty started the previous week on a weak note, falling during the first two trading sessions, with Tuesday witnessing a sharp decline. However, the index managed to recover gradually in the next three sessions. Despite this recovery, the index extended its losing streak to six consecutive weeks, marking one of the prolonged correction phases in recent times.
The index also approached its previous swing low during the week. Although Nifty closed higher from the lows, the recovery remained limited as the index failed to move above the 50% retracement level of the large bearish candle formed on September 15. This suggests despite the buying interest emerging at lower levels, the index has failed to overcome the sharp selling pressure seen from the bear side. Hence, there is not clear sign of a trend reversal.
Breakout From September 15 Large Bearish Candle Range Could Decide the Next Move
The large bearish candle formed on September 15 continues to remain an important reference point for the near-term market direction. The candle created a broad trading range between 23,118 and 23,592, and a breakout on either side of this range could decide the next directional move for the index.
Until the breakout occurs, Nifty is likely to remain in a consolidation phase, with movements largely restricted within the recent range. A sustained move above or below this zone will provide further clarity on whether the market is attempting a recovery or continuing with the ongoing corrective phase.
Nifty's Six-Week Losing Streak: Brings Nifty Near a Key Turning Point
The Nifty's structure continues to remain weak, with the index trading below its 20-week and 100-week moving averages. Meanwhile, the 50-week moving average remains significantly above the current levels, indicating continued pressure on the medium-term trend.
The current decline has matched the longest consecutive weekly losing streak witnessed in the recent past. The magnitude of the fall has also exceeded the correction seen between June and August 2025. After an extended period of weakness, the possibility of a short-term pullback remains open; however, a sustainable recovery would require the index to reclaim important resistance levels.
A close above the previous week's high of 23,593 would improve the short-term setup and indicate the possibility of a counter-trend consolidation. Further confirmation of strength would come only after the index moves above the 20-week moving average at 23,955 and the 50-day moving average at 24,079.
On the downside, the June 11 low of 23,070 remains a crucial support level. A break below this zone could increase selling pressure and open the possibility of a decline towards the next important support area near 22,737.
Daily RSI Rebounds from Oversold Region
Technical indicators are currently giving mixed signals. The weekly RSI has slipped below the 40 level, reflecting weakness in the broader trend. However, the daily 14-period RSI has recovered from the oversold zone and moved above its nine-period average, indicating some improvement in short-term momentum.
The weekly MACD has also generated a fresh bearish crossover, suggesting that medium-term momentum remains weak. Market breadth continues to reflect caution, with several large-cap stocks trading close to their 52-week lows. Meanwhile, mid-cap and small-cap indices, after reaching record highs, have witnessed selling pressure over the past three weeks.
Key Levels to Watch for Next Week: 23,000–23,100 Support Zone
Going ahead, the Nifty is likely to remain range-bound, with last week's trading range acting as an important reference point.
The 23,000–23,100 zone, which coincides with the recent swing low area, will be crucial in determining the next move.
If the index manages to hold this support zone, another recovery attempt within the broader range cannot be ruled out. However, a decisive breakdown below this level could increase downside risks and push the index towards lower support zones.
On the higher side, a sustained move above 23,592 would strengthen the short-term outlook, with upside levels placed at 23,751 and then near the 20-week moving average at 23,955. Until these levels are reclaimed, the broader trend is likely to remain cautious, with selling pressure expected during recovery attempts.
Stock to Watch: Anand Rathi Wealth (ANANDRATHI)
Anand Rathi Wealth recently registered a fresh all-time high and closed at a new high level, indicating sustained buying interest. The stock has been consolidating within a tight five-week range and is currently trading near its previous pivot level, suggesting that it is building a base for the next move.
Volume activity has remained encouraging, with weekly volumes staying elevated over the past five weeks. On Friday, the stock recorded its highest trading volume in the last two months, indicating increased participation. The Relative Strength (RS) line has also moved to a new high, highlighting the stock's outperformance compared with the broader market.
From a technical perspective, the overall trend remains positive. The stock is trading above its short-term and long-term moving averages, with all key averages trending upwards. The weekly Bollinger Bands continue to expand in an upward direction, while the contraction in daily Bollinger Bands suggests a possible sharp move ahead.
The moving average ribbon remains in an uptrend, supporting the positive price structure. Momentum indicators are also favourable, with the weekly MACD maintaining a bullish setup, while the daily MACD is close to generating a fresh bullish crossover. The daily RSI has also moved into the bullish zone, indicating improving momentum.
Overall, the stock's new high close, strong relative strength, rising volumes and positive technical indicators suggest that it is preparing for the next leg of the upmove. A sustained move above Rs 2,242 would be positive and could drive the stock towards Rs 2,366, followed by Rs 2,440. The stop loss can be maintained at Rs 2,140.
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