The Nifty 50 and Bank Nifty extended their southward journey and have decisively broken the November low (23,263), closing at a seven-month low on January 13. Technical indicators suggest that bearish sentiment prevails. Hence, if the index breaks 23,000, 22,800 is the first target on the downside. However, given that the momentum indicator RSI is nearing oversold levels, the possibility of a bounce-back in the upcoming session cannot be ruled out, with resistance at the 23,200–23,350 zone. For the Bank Nifty, the RSI has also dropped to oversold levels, so in case of a rebound, 48,500–49,000 is the likely resistance. However, if it decisively breaks 48,000, the downside target is expected to be 47,000, according to experts.

On Monday, January 13, the Nifty 50 dropped 346 points (-1.47%) to close at 23,086. Bank Nifty fell 693 points (-1.42%) to 48,041. The market breadth consistently favored bears, with approximately 2,373 shares declining against 212 shares gaining on the NSE.

Nifty Outlook and Strategy

Jay Thakkar, Vice President & Head of Derivatives and Quant Research at ICICI Securities

Nifty has broken its previous swing low of 23,263, thus confirming further downside in the market. The momentum indicator MACD (Moving Average Convergence Divergence) is already in sell mode across daily, weekly, and monthly timeframes, indicating that the overall market momentum is weak. Technically, the index is trending lower in a falling channel, and with this fresh breakdown, the lower end of the channel points to the 22,500 level.

Over the past couple of weeks, Nifty managed to hold above the 23,500 level on a closing basis, so this level will now act as crucial short-term resistance. Thus, the near-term range is 23,500 to 22,500.

From the derivatives perspective, the India VIX has hit the 16 level and is likely to inch towards 18–20, indicating further market weakness. The weekly PCR (Put Call Ratio) has fallen to 0.59 and is inching toward the oversold territory of 0.45–0.50. Heavy Call writing has been observed from the 23,200 to 23,500 strikes, with the highest near-term open interest at 23,500 (1 crore) and 24,000 (1.07 crore). On the downside, the 23,000 strike shows some Put open interest buildup, with no significant support below 22,500.

Key Resistance: 23,200, 23,500

Key Support: 23,000, 22,800, 22,500

Strategy: Sell Nifty Futures at CMP and add on a rise near 23,200, with a stop-loss above 23,500, targeting 22,800 and 22,500.

Anshul Jain, Head of Research at Lakshmishree Investments

Nifty has decisively closed below its November low, confirming a structural breakdown. This bearish move shifts focus to the next significant liquidity point at 22,775, the last breakout level before the index’s all-time high. This zone now acts as a logical downside target.

With six down days in the past seven sessions, the trend remains firmly bearish. However, oversold conditions could trigger a short-term bounce toward 23,265–23,345. This resistance zone is expected to cap any upside, making it an ideal level for traders to initiate fresh short positions.

On the downside, 23,000–22,925 serves as immediate support. If this level fails, the decline may extend to 22,775. Traders should remain cautious as heightened volatility is likely in the near term.

Key Resistance: 23,265, 23,345

Key Support: 23,000, 22,925

Strategy: Sell Nifty Futures on rallies between 23,250 - 23,265, targeting a move toward 22,775. Maintain a stop-loss above 23,345 to limit risk.

Riyank Arora, Technical Analyst at Mehta Equities

The Nifty has broken below the major support level of 23,250 and successfully closed beneath it. With the overall trend now negative and psychological support at 23,000, the benchmark is expected to head toward 22,700 and 22,500. A strict stop-loss should be maintained at 23,300 for all short positions.

Key Resistance: 23,300, 23,500

Key Support: 23,000, 22,700, 22,500

Strategy: Short-sell Nifty Futures at 23,085 with a stop-loss at 23,300, targeting 22,700 and 22,500.

Bank Nifty - Outlook and Positioning

Jay Thakkar, Vice President & Head of Derivatives and Quant Research at ICICI Securities

Bank Nifty has broken multiple support levels, including 49,600. Below this level, there is no major support until 47,000, while on the upside, resistance is located at the 49,000–49,500 range. The short-term trend remains negative unless this range is breached.

From the derivatives perspective, the 48,000 strike has the highest Put open interest, serving as immediate support. Below this, 47,000 is the next major support. 49,000 and 50,000 strikes have the highest Call open interest, acting as resistance.

Key Resistance: 49,000

Key Support: 47,000

Strategy: Sell Bank Nifty at CMP and on a rise near 48,500, with a stop-loss at 49,000, targeting 47,000.

Anshul Jain, Head of Research at Lakshmishree Investments

Bank Nifty has decisively breached and closed below the weekly Head and Shoulders neckline at 49,500, confirming a bearish trend. Over the past seven sessions, the index has declined by 3,773 points (-7.3%), marking a significant move. While the trend remains bearish, short-term bounces could occur, with resistance around 48,500–49,200.

The confirmed downtrend, driven by the Head and Shoulders pattern, projects a downside target near 46,000. Immediate support lies at 47,700–47,200, and a breach here could accelerate the move to 46,000.

Key Resistance: 48,500, 49,200

Key Support: 47,700, 47,200

Strategy: Sell Bank Nifty on rallies around 49,200, targeting 47,200–46,000. Use a stop-loss above 49,500 to manage risk effectively.

Riyank Arora, Technical Analyst at Mehta Equities

Bank Nifty has broken below 49,500 and declined nearly 1,500 points from the breakdown level. Currently trading around 48,100, the next major support is at 48,000, followed by 47,000 and 46,500.

Key Resistance: 49,000, 49,500

Key Support: 48,000, 47,000, 46,500

Strategy: Short-sell Bank Nifty Futures at 48,100 with a stop-loss at 49,000, targeting 47,000 and 46,500.