The downfall which started in Oct 2025 still shows no signs of finding any meaningful support. Nifty has corrected more than 13% from the all time high. In February 2025, Nifty 50 has declined over 3.30% so far.
Foreign Portfolio Investors have been selling relentlessly and global trade tensions, with the advent of Mr. Trump is only adding fuel.
This post provides a technical breakdown of Nifty 50 and explores potential trends for March 2025.
Price Action & Key Levels
A Doji candlestick pattern in Jan 2025, in a downtrend, with Feb 2025 candle also looking to close at its lowest point which shows the continuation of weakness. If the Feb candle breaks the low of previous candle, the downtrend can continue.
A clear down trend on a weekly timeframe can be seen where price is making lower lows and lower highs. Price has retested resistance 23500 and now at immediate support around 22800 with the recent candle seeing a long upper wick.
22800 is an important immediate support as Nifty 50 has made multiple lows around the level on daily timeframe.
Closing and sustaining above 23500 should be the first target for even thinking of going long in this market.
Moving Averages
The above chart shows application of 20 Exponential Moving Average on a weekly timeframe. 20 EMA which was earlier acting as support during uptrend, now will be acting as resistance for downtrend, providing good shorting opportunities.
We can see 20 EMA is converging around 23500 resistance which further adds to the strength of resistance at 23500.
RSI and Bollinger Bands
Relative Strength Index (RSI) on a weekly timeframe is below 50 showing weakness. Also, No divergences can be spotted on Daily or Weekly TF for any potential pullback.
The above chart shows Bollinger Bands with 100 moving and 2nd Deviation setup. It can be seen how price reacts near red, blue and green lines.
The fact that 22800 has been holding quite well for multiple days and price being around 2nd deviation (green line), we could see a pullback around 23500.
So, fresh shorts at this moment may not be a good trade.
Open Interest
Looking at the Feb month expiry option data, Call writers are aggressive at 23000 and 23100 which will be acting as strong resistance on the upside.
Highest Put writing is at 22500 which will act as good support. The fact that 22800 doesn’t see equivalent put writers to call writers at 23000 makes it vulnerable to break in the coming week.
So, for the upcoming week, 23000 on the upside and 22500 on the downside, are going to be important levels post which OI development has to be studied for the month of March 2025.
Chart Patterns
Well, Nifty 50 seems to be forming a falling wedge chart pattern which is one of the rare positives. Traditionally, this pattern is seen as bullish but we should never forget that technical analysis works on probabilities and there are no certainties.
Technical analysis should be only used to manage risk rather than predicting the next move. We may have to wait for a couple of weeks for the pattern to play out.
Final Thoughts
There is no denying that the market is under heavy selling pressure and one must absolutely avoid going against the trend.
Additionally, it is important to know when to enter a trade and wait patiently for the right levels to ride the trend.
- Be bullish only when Nifty 50 changes its structure.
- Look for opportunities to go with the trend on a smaller timeframe like Daily..
- Whatever you do, always manage your risk and know how much you are willing to lose.