The Nifty 50 extended its decline on Monday as persistent selling pressure, foreign fund outflows and geopolitical uncertainty continued to weigh on investor sentiment. The benchmark index closed at 22,363.35, down 157.10 points, or 0.70%, with technical indicators suggesting that the near-term trend remains bearish.
“Short-term trend remains bearish, with the Nifty trading below its 11 and 20 day EMAs. A sustained move above last week's high of 22,776 would be needed to signal a bullish trend reversal. On the downside, 22,180 is the near-term support; a break below this level could signal a resumption of the downtrend,” said Nandish Shah, deputy vice president at HDFC Securities.
“The daily candlestick formed a bearish-bodied candle with rejection from higher levels, engulfing the previous session's trading range. This indicates renewed selling pressure and keeps the short-term technical structure weak,” said Hitesh Tailor, technical research analyst at Choice Broking. The formation suggests that sellers remain active during recoveries, limiting the scope for a sustained rebound in the near term.
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Investors are also keeping a close watch on developments in the Middle East, which have contributed to volatility across global financial markets and raised concerns about the outlook for crude oil prices said Ankur Punj, managing director at Equirus Wealth.
Bank Nifty Outlook
The banking benchmark also ended lower on Monday after failing to cross its 20-day exponential moving average (EMA), triggering gradual profit booking through the session. Bank Nifty settled near 54,900, down 0.61%, and formed a bearish candle on the daily chart. However, momentum indicators suggest that the index remains in a broader consolidation phase rather than displaying a strong directional trend.
Sudeep Shah, head of technical and derivatives research at SBI Securities, identified the 54,500–54,400 zone as a crucial support area for the index. “A sustained move below 54400 could trigger further weakness and extend the correction towards the 53800 level,” Shah said.
On the upside, the 55,400–55,500 zone is likely to act as a key resistance, coinciding with the placement of the 20-day EMA.
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