Amid the extended weakness, crude oil prices hovering around $110 a barrel and a persistently weak broader market structure, the Nifty 50 is unlikely to find strong support from bulls. If the index falls and sustains below 22,800, further downside toward 22,600–22,500 cannot be ruled out. However, holding above this level could open the door for a recovery toward 23,000, with a decisive move above that level potentially paving the way for a rise toward 23,200. Meanwhile, the Bank Nifty needs to defend Wednesday’s low near 54,700. A break below this level could invite further selling pressure, dragging the index toward 54,400 and then 54,000. On the upside, holding above 54,700 could improve the prospects of a rebound toward 55,300-55,500, followed by the 56,000 zone, according to experts.
On October 21, the Nifty 50 declined 78 points, or 0.34 percent, to close at 22,811, while the Bank Nifty plunged 511 points, or 0.92 percent, to settle at 54,977. Bears continued to dominate market breadth on the National Stock Exchange, with approximately 2,838 stocks declining compared with just 459 advancing stocks.
Sudeep Shah, Head – Technical & Derivatives Research at SBI Securities
The benchmark index Nifty witnessed a sharp pullback of nearly 1,000 points from its recent low of 22,180 within just eight trading sessions. However, the recovery lost momentum near the 38.2% Fibonacci retracement level, following which the index came under renewed selling pressure and declined sharply over the last two trading sessions.
With the recent weakness, Nifty has once again slipped below its 20-day EMA, indicating a deterioration in short-term momentum. The daily RSI has also eased from its recent peak of 52.81. Nonetheless, it continues to hold above its 9-day moving average.