Global trade tensions dictated the market, because the concerns about new H-1B visa requirements fear an impact on the export of IT services. The Gedempte Guidelines from Accenture have been added to the resistance on the IT sector, while reports of new rates on brand drugs bull firmly pushed on the rear foot with the closure of the week. The pressure was further exacerbated by foreign institutional investors (FIIs) who played net sellers, so that more than £ 5,500 crore were drawn from shares.
With this, analyst Sudeep ShahVice -president and head of technical and derivatives research SBI effectsInteraction with ET markets with regard to the prospects for Nifty and Bank Nifty, as well as an index strategy for the coming week. The following are the edited fragments from his chat:
After a rally of 3 weeks, the market became a hit this week and knew the winning of the last 2 weeks. What is your opinion here?
The Benchmark Nifty index has witnessed a sharp decrease of 2.65% last week and knew more than 60% of the profits in the past three weeks. The fall of the recent high was much faster, because the index dropped by nearly 800 points in just seven trade sessions. This marks the longest losing series since March 2025, with the index being closed in red for six consecutive days – a clear indication of the intensification of Bearish sentiment about sectors.
The most important resistance came from the Nifty IT index, which will be almost 8% nipping during the week. The sale was activated by an announcement from US President Donald Trump, who proposed a substantial fee of $ 100,000 for new H-1B visa applications. This step has expressed serious concern for Indian IT companies. The announcement led to a wave of sale in Frontline -technical shares, where investor sentiment became strongly negative. As an addition to the misery, on Friday, Trump also declared a 100% rate on pharmaceutical imports, so that the prospects for export -oriented sectors such as Pharma are further filled in.
From a technical point of view, during the week, Nifty has violated important advanced averages-the 20-day, 50-day and 100-day EMAs that are all down now. Moreover, the daily RSI has been broken under its rising channel and slipped under 40 markings, which enhances the Bearish Momentum and the Signaling potential for further disadvantage.
Continue, the last line of defense, ie the 200-day EMA zone of 24400-24350, will act as crucial support for the index. Every sustainable movement below the level of 24350 can lead further correction in the direction of the 24000 Mark. At the top, the resistance has now shifted lower to the zone of 24850-24900, which will be the key for every recovery attempt.
The same is the case with Nifty Bank. What are the views there and the most important levels to watch?
The Banking Benchmark Index, Bank Nifty, also came under pressure last week, registered a decrease of almost 2% and closed below 54400. From its recent Swing High of 55835, the index has assumed more than 1400 points in just seven trade sessions, which reflects a rapid correction in bank shares.
On the weekly graph, Bank Nifty has formed a large bearish candle, which indicates a strong sales momentum and a shift in short -term sentiment. From a technical point of view, the index has broken its 20-day, 50-day and 100-day EMAs, all of which are now smoothing downwards, a sign of weakening trend structure.
As an addition to the Bearish arrangement, the daily RSI is about to slide under 40 marks and remains in a falling process. This suggests that the momentum deteriorates and the index may have difficulty finding immediate support unless a broader sentiment improves. The current structure points to caution in the bank space.
Speaking of crucial levels, the 200-day EMA zone of 53800-53700 will act as an important support for the index. Every sustainable movement below 53700 can cause a sharp correction in the direction of the 53000 level. At the top, the resistance has now shifted lower to the 54700-54800 zone, which will act as a crucial obstacle for every recovery attempt.
What are your opinion about the expiry of October? How is it traditionally played?
Following seasonal, in the last 18 years, the October month has often shown a bullish trend for Nifty. On 13 occasions, the index is closed on a positive memorandum with an average profit of 4%, while on 5 occasions it finished on a negative memorandum with an average loss of 11.48%.
The average return for Nifty in the October series was -0.30%. In the last 18 years, October has consistently demonstrated an average volatility of 10.4% for the Nifty index.
What are the sectors to concentrate on this season?
Nifty It: The Nifty It has witnessed a sharp correction last week. It has fallen by almost 8%. It has given a horizontal trendline breakdown on a daily scale. It has fallen in particular under the EMA level of 200 weeks. The weekly and daily RSI slid under 40 Mark and it is in a falling mode. That is why it will probably continue its southern journey in the short term.
Apart from this, Nifty Pharma, Healthcare, Consumer sustainable, financial services, capital market, India tourism, FMCG and Media will probably be left in the short term.
On the other hand, Nifty Metal performs relatively better than the front line indices.
Are there specific shares that you want to show for us?
Technically, LT, Ashok Leyland, took India and Hindustan Petroleum good.
((Indemnification: Recommendations, suggestions, views and opinions of the experts are their own. These do not represent the views of economic times)
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