The Indian equity market is likely to remain cautious and range-bound, with a negative bias, in the trading week opening on Monday, August 31. The Nifty 50 has recorded its third consecutive weekly decline and continues to face resistance near 24,500, while 24,000 remains the key support level.
The weekly chart continues to indicate a constructive medium-term structure, but the daily trend remains weak. Selling pressure could therefore persist unless the index manages to sustain levels above 24,500.
Indian equity markets ended the week on a negative note, with profit booking seen across several sectors. The BSE Sensex declined 0.36 per cent to close at 77,264.51, while the Nifty 50 fell 0.30 per cent to settle at 24,175.70.
The Bank Nifty also declined 0.50 per cent to close at 57,496.30, reflecting continued selling pressure in banking stocks.
Sectoral performance remained mixed. Metal, IT, Pharma and Private Bank stocks emerged as the major gainers, while FMCG, Auto, Media and Realty stocks were among the major losers.
During the week, the Nifty 50 opened at 24,285.10 with a negative bias and initially moved higher to test the weekly high of 24,378.60. The index subsequently weakened and touched a weekly low of 24,090.80 before recovering slightly to close at 24,175.70.
From a technical perspective, the Nifty continues to trade above its key short-term moving averages on the weekly chart, while momentum indicators remain in bullish territory. This suggests that the broader medium-term trend remains constructive.
However, the daily chart continues to indicate a negative bias, with the index trading below its short-term moving averages and momentum indicators pointing to continued downward pressure.
The index formed its third consecutive bearish candle on the weekly chart and closed below the previous week’s level, indicating continued short-term weakness.
On the downside, 24,000 remains the key support. A decisive break below this level could trigger further weakness. However, if the index sustains above 24,000, consolidation may continue over the next few sessions.
On the upside, 24,500 remains the immediate resistance. A sustained close above this level would be required to confirm a stronger bullish trend.
The Bank Nifty ended the week at 57,496.30, declining 0.50 per cent, reflecting profit booking in the banking sector.
From a technical perspective, the index continues to maintain a positive medium-term structure on the weekly chart, as it remains above its major moving averages. However, the daily chart indicates a sideways trend.
The index formed a small bearish candle on the weekly chart and closed below the previous week’s level, indicating a negative short-term bias.
Immediate support is placed near 57,000. A decisive breakdown below this level could turn the medium-term trend negative. Conversely, as long as the index holds above 57,000, the current consolidation phase may continue over the next few weeks.
The immediate resistance remains at 58,700. A decisive breakout above this level would be required to establish a stronger bullish trend.
The Sensex ended the week at 77,264.51, declining 0.36 per cent, reflecting continued profit booking across the broader market.
Technical indicators and short-term moving averages on the weekly chart continue to support a positive medium-term outlook, suggesting that the broader trend remains constructive. However, the daily chart continues to indicate a negative bias.
Immediate resistance is placed around 79,350. As long as the index remains below this level, the short-term downward bias is likely to persist.
On the downside, the nearest important support is placed near 75,500. A decisive breakout above 79,350 or a breakdown below 75,500 would be required to establish the next clear directional move.
Note: Research support for this article was provided by Research Desk, MyEquityLab.com, a SEBI-registered research analyst (Registration No. INH000023843).
Disclaimer: This article is for informational and educational purposes only and does not constitute investment advice or a recommendation to buy or sell any security. Readers are advised to consult a qualified financial advisor and conduct their own due diligence before making any investment decisions.
