Nifty Resistance seen at around 25,500 levels: Analysts

The Nifty closed on Friday below 25,000 level after almost 1%falling, and this weakness is likely to continue in the short term, analysts said. Although the levels of around 24,500 are expected to work as important support for the benchmark, the resistance is probably around a 25,200-25,500 zone. VIX levels can also see an increase, especially closer to the monthly expiry date. However, pharmaceutical shares can continue their upward process.

Arpan Shah
Head, technical research, monarch Networth capital

Where is the Nifty going this week?
The benchmark index was traded with a negative bias and closed under the psychological 25,000 level with a bearish formation. Bank Nifty surpassed the benchmark index and was concluded with a decisive candlestick formation on the weekly graph. FIIs have stayed shorts on indexfutures and their net short positions have reached 86%. Historically, the market has witnessed a short-covered rally as soon as Shorts reach the 86-89% zone. Traders can expect a volatile momentum in all indices during the monthly expiry week. Nifty has support on 24,500 and resistance on 25,200-25,500 levels. Bank Nifty has support at 56,000 and resistance at 57,200-58,000 levels. Trade strategies for the week
Pharma has seen better over the past two weeks and can continue its outperformance. Biocon is the best choice; Cipla and Syngen are in the accumulation zone. RIL has reached almost weekly support level; Investors can accumulate at the current level. Jindal Steel and Power can continue Opwenum. Nifty Defense Index has broken under an important level of support; HAL and Mazagon Dock Shipbuilders are closed with Beerarish Candlestick Formation, and a rally is a short -selling opportunity. Investors can look at the current level at Capri Global Capital, Saksoft, RACL Gartech and NLC India.

Nilesh Jain
VP, Equity Technical & Derivative Research, Center BrokingWhere is the Nifty going this week?
The Nifty expanded his losing series for the fourth consecutive week. It was confronted with a strong resistance near its 21-dma, currently around 25,300, which remains an important obstacle. It has broken the support level of 25,000, which matches its 50-dma, and this zone is now expected to work as a resistance. A decisive movement back above 25,000 could activate a short cover, so that the index is pushed to 25,200. For the coming week, the Nifty will probably act within a range of 24,500-25,200. The VIX seems to have found support in the vicinity of its multi-month layer around the 10-mark and has begun to be higher, which indicates a potential rise in market volatility.

Trade strategies for the week
With the monthly expiry date, the markets are expected to stay volatile in the coming week. We recommend focusing on stock -specific and sectoral possibilities instead of broader index movements. We see sectoral rotation, with market focus that goes back to defensive segments. The Pharma Index shows strength by forming a higher upper soil structure, indicating a positive trend in the short term. Stocks such as Lupin, Cipla, Torrent Pharma and Apollo hospitals look well positioned and can be considered for accumulation. SBI Life and HDFC Life seem better placed in the insurance room. The IT sector weighs indices. The overall structure remains weak. As such, it is advisable to stay away from the sector for the time being. In addition, oil and gas and FMCG sectors also show signs of weakness and lack of conviction in the neighborhood.

Ruchit Jain
Head, Technical research, Motilal Oswal Fin Services

Where will the handy go next week?
After an 18% rally from the LOTY of April, Nifty entered into a corrective phase in July. Index closed the week under 50 DEMA and the RSI on daily and weekly graphs continues to show a negative crossover. The index is expected to act within a range of 24,600-25,250, and a decisive breakout above will be needed for resumption of the upward trend. In the case of a breakdown under 24,600, the following support is in earlier Swing Low Zone of 24,500 – 24,450.

Trade strategies for the week
Midcap and smallcap indices remain in a consolidation phase. Most sectoral indices show signs of a break or pullback. We continue to advise traders to stay careful in the short term. Parma and Healthcare can perform better and selective opportunities can be considered in Torrent Pharma, IPCA Labs and Max Health