◉ Introduction
The Nifty 50 dropped for the fifth week in a row, losing around 1.5%. Sectors like banks, IT, and consumer stocks are under pressure, and there are no big positive news to lift the market right now.
◉ Why is the Market Falling?
Poor Q1 Results:
Many big companies, especially in banking and IT, reported weaker-than-expected earnings. This disappointed investors and led to selling.
U.S.–India Trade Trouble:
The U.S. has added a 25% tax on Indian exports starting August 1. The two countries couldn’t agree on some trade issues, especially related to agriculture and dairy. This is bad news for export-focused companies.
Weak Rupee:
The rupee is near record lows against the U.S. dollar. This is because foreign investors are pulling money out of India. A weak rupee hurts sectors like IT and pharma, which earn in dollars.
◉ What the Charts Say?
The market has had a tough 5 weeks, but now it’s near a strong support level. This means a short-term bounce (dead cat bounce) is possible — a small recovery before another fall.
Support at 24,500:
There’s a large number of put option writers at this level. This means many traders are confident that Nifty won’t fall below 24,500 — so they’re willing to take that risk. This builds a strong support zone.
Resistance at 24,700–24,800:
There’s heavy call writing in this range. That means traders are betting Nifty won’t go above these levels. As a result, this area acts like a short-term ceiling or resistance.
Expect the Nifty to stay between these levels coming week unless some major news changes the game.
◉ Suggested Strategy
For Traders:
Stay cautious. Avoid aggressive long positions unless Nifty reclaims 25,000 decisively. Look for shorting opportunities near resistance zones with strict stop losses.
For Investors:
Stick to quality. Defensive pockets like FMCG, utilities, and select pharma may offer stability amid broader volatility.