Traders stay guarded as Nifty turns range-bound, support at 25,100 zone

After failing to hold above 26,000 last week, analysts expect Nifty to remain range-bound, with traders likely to stay cautious. Support is seen at 25,300 and 25,100, below which further downside may emerge, while resistance lies in the 25,700–26,000 zone, where volatility could persist.

RUCHIT JAIN VICE PRESIDENT, MOTILAL OSWAL FINANCIAL SERVICES

Where is Nifty headed this week? The pullback move last week witnessed selling pressure around the psychological mark of 26,000, making it a key short-term resistance zone. Nifty has ended below its 20-DEMA of 25,630.1, led primarily by weakness in IT stocks. Market breadth has also deteriorated in the last couple of sessions, indicating selling in broader markets as well. Technically, this indicates a rangebound-to-negative bias trend for Nifty in the immediate term. Strong support is placed in the range of 25,200–25,100, while resistance remains firm at 26,000.

Trading Strategies: As Nifty has already seen a correction from resistance and is still away from its support, the risk-reward for directional positions appears unfavourable. Traders may consider adopting a wait-and-watch approach. Any dip towards the 25,200–25,100 support band could offer opportunities for contra trades, as the risk-reward dynamics would turn more attractive near those levels.

TOP STOCK PICKs

Bajaj Finance: BUY CMP Rs 1,030 | Stop loss: Rs 980 | Target Rs 1,120 The Bajaj Finance stock has resumed its positive trend post the recent corrective phase. Torrent Pharma: BUY | CMP Rs 4,070 | Stop loss: Rs 3,980 | target: Rs 4,250 The stock has been an outperformer within the pharma sector, and is on the verge of a consolidation breakout.TANMAY SHAH RESEARCH HEAD, SIHL

Where is Nifty headed this week? Technical indicators point to emerging downside pressure, suggesting that the recent rally lacks strong follow-through buying. At present, the index is finding support near its 20-day simple moving average (SMA) around 25,468, which is acting as an immediate cushion. On the shortterm timeframe, momentum oscillators indicate an oversold condition, raising the possibility of a technical bounce towards the 25,700 zone in the coming sessions. On the downside, the 200- day moving average at 25,292 represents a critical medium-term support. A decisive close below this level could weaken sentiment further and open the door for a decline towards the 25,100 area, where a previous gap is placed.

Trading Strategy: For the February 24 Nifty weekly expiry, traders may consider deploying an Iron Condor strategy in line with the current rangebound market conditions. This would involve selling 24,800 Put and buying 24,600 Put, along with selling 26,050 Call and buying 26,250 Call, to maintain a defined risk profile. The strategy is aimed at benefiting from time decay and is best suited if Nifty continues to trade within the 24,800–26,050 band until expiry.

TOP STOCK PICKS Tata Motors Passenger Vehicles: BUY | CMP: Rs 380 | Stop loss Rs 369 | Target: Rs 395–399 After an extended correction, the stock is now trading above its key moving averages, and is showing relative strength. In this setup, a buy can be considered with an upside target of Rs 395–399, keeping a closing stop loss at Rs 369.

Dr. Reddy’s Laboratories: BUY | CMP: Rs 1,268 | Stop loss: Rs 1,244 | Target: Rs 1,295–1,320.

Stock is trading comfortably above its 200-day SMA and is nearing a breakout from its channel formation, supported by healthy volumes. Given this constructive setup, one may initiate long positions, with targets at Rs 1,295 and Rs 1,320, while keeping a closing stop loss at Rs 1,244.

SUDEEP SHAH HEAD – TECHNICAL AND DERIVATIVES RESEARCH, SBI SECURITIES

Where is Nifty headed this week? Nifty enters the week on a weak footing after failing to sustain above the 26,000 mark and witnessing sharp profit booking near 26,009. The 550-point decline in the final two sessions signals clear supply at higher levels. Technically, the structure has deteriorated, as the index has slipped below its 20-day, 50-day and 100-day EMAs, with the shorter averages now sloping downward—a bearish shift in trend bias. Momentum also remains subdued, with the daily RSI slipping below its short-term average and failing to reclaim the 60 zone during the recent pullback. The pattern suggests a lower-high formation in the near term, indicating rallies may face resistance. Immediate support is placed at 25,350–25,300. A decisive break below 25,300 could extend the correction towards 25,100 and possibly 24,900. On the upside, the 25,700–25,750 zone remains a strong resistance band. Unless this hurdle is convincingly crossed, the broader bias stays cautious to negative for the week.

Trading Strategies: Amid a cautious outlook, traders should refrain from over-leveraged bets, while investors should favour a buy-on-decline approach in quality names with strong technical setups. We expect the Nifty to consolidate between 25,100 and 25,800, while Bank Nifty may consolidate between 59,600 and 60,800 levels.

TOP STOCK PICKS L&T: BUY CMP: Rs 4,173 | Stop loss: Rs 4,030 | Target: Rs 4,380–4,430 The stock continues to trade near its 52-week high, with the price remaining above key long-term moving averages (50 and 200 DMA), signalling structural strength in the broader trend. Short-term technical structure is also in sync with long-term charts and is displaying superior relative strength.

Pricol: BUY CMP: Rs 633 | Stop loss: Rs 608 | Target: Rs 665–690. Chart shows bullish positioning, with most moving averages—across short, medium and long periods— sloping upward and price trading above them, indicating an underlying uptrend.