Nifty Faces Key Test At 25,000: SEBI RAs Signal Caution Amid Breakdown Signs

Indian markets fell for the second straight week, weighed down by global tariff worries and underwhelming first-quarter earnings from tech giant Tata Consultancy Services (TCS) on Friday. After eight weeks, the weekly candle on the Nifty index closed bearish below its previous week’s low.

SEBI-registered analyst Bharat Sharma of Stockace Financial Services noted that the Nifty index breached its 20-day Exponential Moving Average (EMA) and an important support of 25,200 on Friday, continuing its decline after a gap down opening. This is not a good sign for the bullish investors, he added, as riday’s candlestick alone was enough to induce further panic among those holding long positions. 

On the daily chart, the prices show an extension of the previously established consolidation box: the upper boundary is at at 25,100, with the psychological support at 25,000, and both are under high risk, Sharma said. 

If the market does not stabilize at these levels, there is a risk of the Nifty reentering consolidation and headline lower towards the 50-day EMA of 24,900-24,880. This is a common technical observation when the market closes below 200-day EMA. 

Technical outlook has shifted to slightly bearish tone. Sharma believes that it may take some time for the index to reverse course or resume its upward trajectory. The focus now shifts to the 25,100 and 25,000 levels for near-term direction. The next moves depends on how market performs around these levels, amid important earnings in the week ahead.

For intraday trading on Monday, immediate support is seen at 25,140–25,130. If the index falls below this range, further supports are anticipated at 25,080, 25,040, and finally at 25,000. The likelihood of breaching the 25,000 level in a single attempt appears low, suggesting some resilience may be observed if the decline continues.

Sharma identified immediate resistance at 25,200, a level that Nifty tried to defend twice on Friday but failed to hold as support. If the index moves above 25,200, then it could approach the 25,300 mark or higher, through it looks challenging. He concluded that if the index held above 25,200, it could generate a positive sentiment among traders.

Analyst Dipak Takodara highlighted that the price action has now dipped below the recent tight range of 25,330–25,380, indicating a short-term breakdown. Friday’s candle pattern signaled a follow-through selling after multiple sideways sessions, which shows more of a range breakdown than a reversal pattern. 

Takodara added that while the short-term trend is weakening, the medium-term uptrend is still intact as long as price stays above the 50-day Simple Moving Average (SMA) of 24,955. He asked the traders to watch for a potential pullback or bounce near this level. Even as the weakening momentum suggests caution for aggressive long trades. 

He identified key resistance and support levels: 

 • Resistance Zones: 

25,330–25,380 (recent support turned resistance) 

25,640–25,740 (supply zone) 

• Support Zones: 

Immediate: 25,116 (horizontal level) 

Crucial: 24,955 (50-DMA) 

Major support: 24,502–24,462 (gap zone) 

Takodara believes that a healthy correction might be unfolding after a strong rally. If the Nifty index holds above 24,955, bulls may step in. However, a break below that could trigger a move toward 24,500 zone.

Meawhile, Financial Independence noted that even amidst the market volatility, Foreign Portfolio Investors (FPIs) remained net buyers in July, pumping in ₹3,839 crore so far, a sign of sustained global confidence in Indian equities. They added that technical analysts advised a “sell-on-rally” strategy for IT, while FMCG continues to gather strength.

As for key triggers, markets will be bracing for tariff headlines, upcoming Q1 earnings, FII trends, key domestic data, IPO flow, technical levels, and rupee movement, which are likely to shape this week’s action, they added.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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