Whats in for Nifty next week? Find out here!

Next week will be a decisive week as the monthly contracts will expire and high volatility is expected.

This week, Nifty registered a fall of about 338 points or 1.87 per cent to close at 17,764.80.

Nifty witnessed at a pullback in the last couple of weeks but it wiped out all its gains this week. It broke its crucial support zone of 17,870-17,850 on Thursday, which led to further fall.  However, a positive point to note here is that Nifty still hasn’t breached its low of 17,613 of October last week. It is below its all-time high level by about 900 points. On the daily timeframe, it closed below its 50-DMA for the first time since May 2021. The RSI also shows weakness at 44. The technical parameters clearly indicate the bearishness of Nifty.   

Analysing options data, the 18,000 call option continues to have the highest open interest and will be a major hurdle for the bulls. The PCR stands at 0.64, indicating pressure on the higher side.   

One probable reason for this weakness is the relentless selling of FIIs. The FIIs sold for about Rs 4,500 crore in the cash segment last week. The DIIs too didn’t support the market, leading to persistent fall in the market.  

Next week will be a decisive week as the monthly contracts will come to an end and high volatility is expected. The next support is at 17,613 and if that is broken, it must expect the level of 17,500 soon. The only turnaround for Nifty would be when the FIIs turn net buyers and Nifty closes above 18,000. However, it seems too much to ask for the upcoming week. We expect Nifty to trade in the broader range of 17,600-18,300 for the next couple of weeks. The charting pattern suggests that the supports are near, and one must keep an eye on the crucial supports. Besides, any reversal indication can be taken positively.