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Among sectoral indices, only Nifty Financials, Metal, and Banks managed to stay positive, while the rest ended in the red. The advance-decline ratio remained weak, with decliners outpacing advancers by nearly 5:1.
Technical view
Since breaking below 22,700, the Nifty has moved in a narrow range, between 22,500 and 22,700 for three consecutive sessions. The 14-day Relative Strength Index (RSI) is trending sideways around 30, indicating weak momentum. Meanwhile, the MACD indicator recently saw a negative crossover below the zero line, reinforcing bearish sentiment.
As per O’Neil’s market direction methodology, we downgraded the market status to a Downtrend on Friday, following Nifty’s breach of its recent correction low at 22,725.
A shift to a Rally Attempt would require the index to either close in positive territory or finish in the upper half of the day’s range—and then sustain above its recent low for three sessions. A follow-through day would be needed to confirm a return to an Uptrend.
Market outlook
The index continues to trade with a negative bias, with immediate support at 22,500—a level it has defended for three days. A breakdown below 22,500 could accelerate selling pressure toward 22,000–21,800. On the upside, strong resistance is placed at 22,800, followed by 23,000.
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How Bank Nifty performed
Bank Nifty opened on a positive note on Thursday, 27 February, and maintained its strength throughout the day, staying in positive territory. The index formed a bullish candle on the daily chart and closed on a positive note after a four-day losing streak yesterday.
Bank Nifty had opened at 48,732.20, traded in the range of 48,972.55–49,871.15, and closed at 48,743.80.
The 14-day RSI has been moving sideways and is currently positioned around 41–42. Meanwhile, the MACD is trading with a negative crossover and remains below its central line.
According to O’Neil’s methodology of market direction, we downgraded the market status to an Uptrend Under Pressure 14 February, due to technical weakness and an elevated number of distribution days. We will change the status to a Downtrend if the distribution day count increases or if Bank Nifty fails to hold above the correction low of 47,898.35.
On the flip side, the market status will be changed back to a Confirmed Uptrend if the index retakes 50,641.75 (its recent rally high).
Nifty Bank remains below all key moving averages, trading with a negative bias within the 48,000–50,000 range. A breakout or breakdown beyond this range could determine its next directional move. Immediate support lies 48,000–47,700, and resistance at 50,000, followed by 50,641.75
Stocks recommended by MarketSmith India:
● Cholamandalam Investment and Finance Company Ltd: Current market price ₹ 1,438.65| Buy range ₹ 1,390–1,445| Profit goal ₹ 1,645| Stop loss ₹ 1,338| Timeframe 2–3 Months
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● Mahindra & Mahindra Financial Services Ltd: Current market price ₹ 280.1| Buy range ₹ 275–283| Profit goal ₹ 320| Stop loss ₹ 262| Timeframe 2–3 Months
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.
