Market participants had briefly taken comfort from the rebound seen earlier, but the reversal in sentiment has reinforced the view that the broader trend remains fragile. According to technical analysts, the current setup suggests that the market is still navigating a challenging phase where selective opportunities may exist, even as the broader indices struggle to sustain momentum.
Speaking to ET Now, Vinay Rajani from HDFC Securities explained that despite the recent bounce, the broader trend for the Nifty continues to remain weak from a technical perspective.
“Yesterday’s recovery was convincing but still the primary trend on the Nifty is bearish because Nifty is placed below 5, 10, 20, 50, 100, and 200 days moving average. So positional trend is clearly on the bearish side. It is only that we are trying to protect the level of 24,300 which happens to be the recent swing low and the previous swing lows was also seen around 24,300-24,350 odd range, so that becomes the strong support. There is a chance of recovery if we do not break this level. But yes, right now the Nifty is currently moving in the yesterday’s entire move. So, consolidation is going on.”
Rajani noted that while the benchmark index is struggling to establish a firm uptrend, the selling pressure is not uniform across sectors. Certain pockets of the market are still showing resilience and even touching fresh highs.
“Some sectors are still doing well like defence, power stocks, capital good stocks are performing very well. In fact, they are hitting their 52-week high, that is also a good sign. So, it is not across the board selling in the market. Some stocks are still performing despite getting into this overall primary downtrend. So, yes, in trading you have to be very stock specific and sector specific.”He added that public sector undertakings, particularly in the power and defence segments, continue to exhibit strength on the charts.”And PSUs are looking very strong to us be it a PSU power stocks or be a PSU defence stocks. They are looking strong to us and we think stocks specific market will remain bullish. But yes, as far as Nifty is concerned, strict stop loss of 24,300 we are recommending to our clients.”
From a technical standpoint, Rajani believes the key level to watch on the upside remains significantly higher, which could signal a meaningful shift in the market trend.
“On the upside, Nifty has to close above 25,000 to confirm the bullish trend reversal, otherwise, it will remain into overall downtrend and consolidation you can say till the 24,300 is getting breached again. So, we are into a consolidation phase we can say. So, we need to see primary trend is still down. So, there is upper hand of bears in the market right now. So, we have to protect our long trades with the strict stop loss and for Nifty it should be 24,300.”
When asked about specific trading ideas in the current environment, Rajani highlighted select PSU stocks that are displaying favourable technical setups.
“So, as I said, we are bullish on the PSU. So, one stock we like in the defence space is Bharat Electronics, around 471 one can go long, stop loss 464, on the upside target should be 485. The second pick from the PSU power space, NTPC is looking good, 385 should be the entry, 378 should be the stop loss, on the upside 395 should be the target.”
With the market lacking a clear directional trend, analysts suggest that traders may need to stay disciplined with risk management and focus on stock-specific opportunities rather than broad index bets. In a market that is swinging between optimism and caution, technical levels such as Nifty’s 24,300 support and the 25,000 resistance could play a crucial role in determining the next decisive move.
