Nifty Correction Or New Rally? SEBI Analysts Split On Next Move Above 25,300

The Nifty index scaled 25,100 last week, rising for the eighth consecutive session. Despite the rise, Foreign Institutional Investors (FIIs) extended selling for the 11th straight week (₹3,577 cr sold) while Domestic Institutional Investors (DIIs) kept absorbing supply (₹13,703 cr bought). 

Defense, technology, and PSU banks were in favor, along with autos, metal,s and pharmaceuticals. On the other hand, only the consumer durables sector lagged last week. The Indian rupee hit a fresh low near 88.45/USD before closing flat (week-on-week).

For the upcoming week, traders will be watching for developments on the US-India trade deal as both countries resume talks, along with a crucial US Federal Reserve rate meeting for global cues.

SEBI-registered analysts shared the market outlook for the week ahead. 

Weekly outlook

Analyst Mayank Singh Chandel said on the weekly chart, Nifty reclaimed the short-term averages and closed just below the supply zone at 25,150–25,250. He highlighted that the Relative Strength Index (RSI) around 57 shows that momentum is improving but not overbought. According to him, the bulls need a decisive weekly close above 25,250 to confirm a trend resumption. 

 Key levels to watch:

. Immediate support: 24,750 

. Critical support: 24,400 (below this opens 24,200 / 23,800) 

. Immediate resistance: 25,150 – 25,250 

. Critical resistance: 25,600 (then 25,800) 

F & O cues

Derivatives data show that the Put Open Interest (OI) is concentrated at 24,500 / 24,800 / 24,900–25,000, indicating a base building in this band. The Call OI is heavy from 25,200 up to 25,550, which shows a layered supply overhead. The overall data indicated a zone between 24,800–25,500 heading into Tuesday's expiry unless a catalyst forces a break. 

What Should Traders Do?

Chandel shared three scenarios for the week ahead. In the base case, one can expect a range-bound trade between 24,750 and 25,250 with upward bias while the price holds above 24,750 and the volatility index (VIX) stays muted. 

In a bullish scenario, a sustained move or close above 25,250 could open the door towards 25,600. And in a bear case, a fall below 24,750 (and especially less than 24,400) would show momentum fading, and one can look for 24,200, 23,800.

Nifty: Impulsive Rally?

Analyst Kush Ghodasara also noted that one of the reasons Nifty's move last week cannot be considered an impulsive wave rally is that it followed a recent correction from 25,153 to 24,404, which retraced more than 78.6% of the previous rally, which had moved from the low at 24,337 to 25,153. It is more likely to represent the formation of a corrective Wave A-B-C, he added. However, to validate this possibility, the index shall not close above the 25,300 level in the coming week.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

MENAFN15092025007385015968ID1110060525