The stock market never fails to surprise traders. Just when it seems safe to go long, the market reverses and hunts liquidity. This is a common experience for retail traders who often feel, “The market always reverses after I enter a trade.” The reality is that smart money seeks liquidity, sweeping out weaker hands before moving in its actual direction. If you want to make consistent profits in the stock market, you need to think smart, adapt quickly, and analyze market movements deeply.
In today’s session, we saw a big red candle in Nifty and Sensex, while Bank Nifty and Fin Nifty closed flat. This divergence between indices hints at an interesting market structure. Let’s break it down further.
Market Overview:
Nifty & Sensex witnessed heavy selling, but banking and financial indices remained resilient.
Nifty Movers:
Market Breadth:
Sectoral Performances.
- Almost all sectors closed in RED except Nifty FMCG
- Nifty Pharma (-4.03%), Nifty Reality (-3.60%) & Nifty It (3.58%) lead Nifty under 23,000.
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Technical Analysis: It’s a Bearish Party – What’s Next?
Price Action & Technical Analysis
Daily Chart:
🔹Strong selling pressure confirmed as Nifty broke previous support at 23,150 and 23,000, closing near 22,900.
🔹Next key support lies in the 22,500-22,600 zone, where a trendline support also exists.
🔹RSI (14) on the daily chart has dropped to 45, indicating further downside potential.
Hourly Chart:
🔹A clear downtrend is visible with RSI (14) at 24, signaling a highly bearish sentiment.
🔹Any minor retracement to the upside is likely to be sold into, continuing the downward pressure.
Open Interest Analysis: Key Support & Resistance Levels
- Strong Resistance: 23,000 CE (1.01 Cr. OI) – Heavy call writing signals strong resistance at this level.
- Strong Support: 22,500 PE (77 Lakh OI)– providing a cushion for the index.
- 22,800 PE holds 60 Lakh Open Interest, hinting at potential support.
- Crucial Make-or-Break Level: 22,900 (48 Lakh PE vs. 43 Lakh CE) – This level will decide tomorrow’s market direction.
OI Buildups
Nifty & Bank Nifty showing a Short Buildup, while Nifty Financial Services exhibit Long Buildup, indicating selective buying in financial stocks.
Crucial Make-or-Break Level: 22,900 (48 Lakh PE vs. 43 Lakh CE) – This level will decide tomorrow’s market direction.
🔸 Additional Observations:
- 22,800 PE holds 60 Lakh Open Interest, hinting at potential support.
- Nifty & Bank Nifty show a Short Buildup, while Nifty Financial Services exhibit Long Buildup, indicating selective buying in financial stocks.
FII & DII Activity Analysis (Will be updated shortly)
- 📊 FII Activity: -3483.98 Cr. Sell
- 📊 DII Activity: -1720.32 Cr. Sell
- FII has strong buy of 31100 Cr. in index options which indicates big volatility tomorrow.
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Market Prediction & Trade Plan: Follow the Trend
📌 What’s Next for Nifty?
- With strong bearish momentum, following the trend is the best strategy.
- Sentiment has shifted to bearish, so intraday traders should look for resistance zones to enter short positions.
- A bearish candle is likely to form tomorrow, continuing today’s downward trend.
Key Learning from Today’s Market:
- ✅ Adapt quickly: Never hold onto a bias when the market breaks key levels.
- ✅ Stay flexible: If markets are volatile, your trading strategy should be too.
- ✅ Liquidity hunting is real: Always consider the possibility of false breakouts before taking positions.
Conclusion: Prepare for a Bearish Market
Nifty has broken key support levels, and the downtrend is gaining momentum. While some support is seen around 22,500-22,600, the overall sentiment remains weak. Traders should focus on resistance points for shorting opportunities rather than looking for early reversals.
📢 What’s your market view for tomorrow? Share your insights in the comments! Let’s discuss and refine our strategies together.
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