Nifty Hangs by a Thread at 24,700 – Ready to Fall Further?

Friday’s session saw Sensex and Nifty slip nearly 1% as global tensions rose and crude prices jumped after the Israel-Iran escalation. Markets opened weak, with Sensex plunging over 1.6% intraday before recovering modestly. Nifty settled at 24,718, perilously close to the critical 24,700 mark.

Global Cues and Oil Spike Stir Caution

News of strikes and retaliation in the Middle East sent crude prices higher, stoking fears of wider risk-off sentiment. When oil climbs, cost pressures loom for many sectors, denting investor confidence. This backdrop weighed on financials and cyclicals alike, leaving indices vulnerable to further dips.

Technical Alarm: The 24,700 Threshold

Analysts warn that a decisive break below 24,700 on Nifty could trigger accelerated selling. Rupak De notes the index briefly broke below its 21-day EMA before finding support near consolidation lows. If Nifty holds above 24,700, a bounce toward 25,000 remains possible; but a clear breach may open the door to deeper weakness.

Consolidation Zone: 24,400–25,200 Range

According to Bajaj Broking, Nifty’s weekly bearish candle suggests profit-booking around 25,200, aligning with the 78.6% retracement of the prior decline. The index is likely to trade between 24,400 and 25,200 in the near term. A drop below 24,400, near the 50-day EMA, would signal further downside, while 25,000 stands as immediate resistance.

Bank Nifty Under Pressure Too

Bank Nifty formed a large bearish weekly candle, with selling near 57,000. It closed the week in the red on four of five sessions. A close below Friday’s low of 55,150 could bring 54,500–54,000 into focus, zones supported by the 50-day EMA. On the upside, 56,000 remains a hurdle; only a sustained move above may pause the decline.

Investor Playbook: What to Do Now

• Watch Key Supports: Nifty 24,700–24,400 and Bank Nifty 55,150–54,500. A breach can signal more downside.
• Monitor Global Developments: Any de-escalation in the Middle East could calm oil and risk sentiment, aiding a rebound.
• Assess Sector Exposure: Defensive sectors may hold up better; cyclicals and financials could face pressure until clarity emerges.
• Stagger Entries: If buying dips, scale in near support zones with tight stops below critical levels.
• Use Technical Signals: Look for confirmation—e.g., intraday reclaim of 24,700 or Bank Nifty reclaiming 56,000 on healthy volume.

Conclusion: Stay Agile and Vigilant

Nifty’s flirtation with 24,700 underlines a fragile mood amid geopolitical jitters and rising oil. While a bounce remains possible if support holds, a decisive fall could intensify selling. Bank Nifty’s own weakness reinforces caution. Retail investors should keep a close eye on support levels, global cues, and upcoming data or earnings that may tip the balance. In volatile times, disciplined risk management and readiness to adapt are key to navigating unclear markets.

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