F&O Discuss | Nifty grapples with lifeless cat bounce syndrome as pullbacks get bought. Sudeep Shah on Olectra, IDBI, 4 extra shares
International cues stay detrimental with the Iran-Israel conflict getting into the fourth week. The vitality costs stay elevated with Brent hovering close to the $113 a barrel mark. For home markets, persistent FII outflows and rupee weak point stay a rising concern.
Concern index India settled at 22.81 on the NSE within the final session, mildly up by 0.04%.
Analyst Sudeep Shah, Vice President and Head of Technical & Derivatives Analysis at SBI Securities, interacted with ETMarkets relating to the outlook for the Nifty and Financial institution Nifty, in addition to an index technique for the upcoming week. The next are the edited excerpts from his chat:
Q: Nifty ended mildly detrimental at 0.2% WoW, narrowing its losses by Friday positive factors because the bull began emphatically however misplaced momentum in direction of the top. Was it quick protecting or do you see the development persevering with subsequent week as properly?
Markets have little tolerance for uncertainty—and the continuing escalation in West Asia since February 28 has stored threat urge for food firmly in examine. For the reason that onset of the battle, the Nifty has corrected sharply by over 2000 factors, reflecting the sustained stress from international cues and risk-off sentiment.
The value motion throughout this section has been telling. The index has witnessed three distinct lifeless cat bounces, every met with aggressive promoting at larger ranges—clearly underscoring the agency grip of bears in the marketplace. Each pullback has been bought into, highlighting an absence of conviction amongst consumers. Whereas Nifty managed to finish the present week on a flat word, the underlying weak point continues to persist.
Volatility remained elevated all through the week. The index staged a pointy restoration of practically 900 factors within the first three buying and selling classes, solely to see all positive factors fully erased on Thursday-marking the sharpest single-day decline since June 4, 2024. In the end, Nifty ended the week on a muted word, extending its shedding streak to 4 consecutive weeks.
Sectorally, the ache has been most seen in Vehicle and Banking shares, which have been the important thing outperformers previous to the battle. These sectors have borne the brunt of promoting stress, largely pushed by sustained FII outflows, with overseas buyers offloading a large ₹81262 crore within the ongoing March sequence. Given their heavy publicity to those sectors, FII promoting has amplified the draw back momentum.
A significant overhang for the markets has been the sharp surge in crude oil costs. Brent crude as soon as once more spiked to $114.3 per barrel through the week earlier than witnessing a marginal cooling off. Concurrently, considerations round gasoline shortages and provide disruptions have intensified, with key vitality commodities witnessing steep value will increase for the reason that begin of the battle. Elevated vitality costs proceed to pose a threat to inflation dynamics and company margins, thereby weighing on fairness markets.
From a technical standpoint, the development stays decisively detrimental. The index is at present buying and selling under its all of the essential shifting averages, and the formation of a bearish candlestick with a protracted higher shadow signifies persistent promoting stress at larger ranges. Including to the warning, the weekly RSI has slipped to 30.22, marking its lowest stage for the reason that COVID-led market correction—signalling deeply oversold circumstances, but with no clear reversal set off.
Q: What ranges shall be necessary for Nifty this week and the way ought to one commerce?
For Nifty, the 22,850–22,800 zone will act as instant help. A sustained breach under this stage might speed up the decline in direction of 22,500. On the upside, the 23,420–23,460 zone is prone to act as a stiff resistance, with any pullback anticipated to face promoting stress on this band.
Q: Market’s lackluster efficiency will be attributed to Nifty Financial institution, which has delivered its third worst efficiency in March previously 20 years, declining by practically 11%. What do Financial institution Nifty charts counsel and methods to commerce?
For the fourth consecutive week, the banking benchmark index Financial institution Nifty ended on a detrimental word, underscoring sustained weak point and protracted promoting stress within the banking house. Most notably, on the weekly chart, the index has fashioned a small-bodied candle with a protracted higher shadow, which clearly displays promoting stress rising at larger ranges and a failure to maintain intraday and weekly recoveries.
Moreover, for the second straight week, Financial institution Nifty has closed under its 100-week EMA, which is a vital long-term development indicator and reinforces the bearish undertone. On the each day timeframe, the index continues to stay underneath stress, because it has been buying and selling persistently under its 200-day EMA for the previous ten buying and selling classes. This extended keep under the long-term shifting common highlights a lack of medium-term development energy and signifies that rallies are being bought into.
Momentum indicators additionally stay firmly biased in direction of the draw back. Each the each day and weekly RSI are positioned in bearish territory and are sloping downward, suggesting weakening momentum and restricted scope for any significant upside within the close to time period.
Going ahead, the zone of 54,300–54,400 is predicted to behave as a key resistance space for the index. So long as Financial institution Nifty trades under the 54400 mark, the broader outlook is prone to stay detrimental. In such a situation, the index might proceed its downward trajectory and take a look at the instant help close to 52,200, adopted by the subsequent necessary help round 51500 within the
Q: Auto sector is one other prime loser and its prospects are tied to grease costs and inflation. In gentle of the Iran-Israel conflict, do you anticipate extra correction, or is a backside seen?
Nifty Auto staged a robust rebound in step with the broader market, bouncing from the 24,230–23,850 zone, a area that had beforehand acted as sturdy resistance throughout June–August 2025. Nevertheless, the pullback proved short-lived because the index encountered stiff resistance close to the 25,700–25,750 zone and ultimately closed decrease.
Notably, after going through rejection across the 28,720–28,820 zone between February 11–26, 2026, the index has corrected practically 14%, confirming a double-top neckline breakdown within the course of.
Technically, the index continues to commerce under its key quick and long-term shifting averages, indicating a weak underlying development. Momentum indicators additionally stay bearish. The RSI has did not maintain above the 40 mark regardless of a number of makes an attempt, whereas the MACD stays under each the zero line and the sign line. Moreover, a rising ADX suggests strengthening bearish momentum.
Going forward, the 25,200–25,300 zone is prone to act as a vital resistance. So long as the index stays under this stage, the broader development is predicted to remain detrimental. On the draw back, the 24,200–24,100 zone serves as a key help, and a decisive breach under this vary might set off additional draw back within the index
Q: Fed has left coverage charges unchanged and has indicated a single fee reduce of 25 bps this yr. This comes as a blow to the tech sector which is already reeling underneath the AI risk. What’s your tackle the sector and any most well-liked inventory to purchase?
Since peaking at 40,301 on third February, the Nifty IT Index has corrected sharply by practically 28%, reflecting a mix of world macro headwinds and a deeper structural concern round AI disruption.
Whereas a stronger greenback sometimes acts as a tailwind for IT firms on account of larger export realizations, this time the profit has been overshadowed. The core challenge lies within the rising notion that AI poses a basic risk to conventional IT companies, particularly in areas like low-end coding, upkeep, and repetitive back-office features. Markets have been fast to cost on this threat, resulting in sustained promoting stress.
That mentioned, it’s necessary to notice that main IT firms usually are not standing nonetheless. Corporations like Tata Consultancy Companies, Infosys, and HCLTech have been actively investing in AI capabilities, constructing proprietary platforms, and integrating AI-led options into their service choices. Nevertheless, this transition is gradual in nature, the advantages are unlikely to replicate instantly in earnings and should take just a few quarters to materialize meaningfully.
From a technical standpoint, the setup stays weak. The index continues to commerce under its key short- and long-term shifting averages, indicating a sustained downtrend. The MACD line stays properly under each the sign line and the zero line, reinforcing bearish momentum. Though the tempo of decline has moderated just lately, there are nonetheless no clear indicators of base formation or development reversal.
Given this backdrop, it will be prudent to keep away from backside fishing at this stage. A extra smart method can be to attend for indicators of stabilization, similar to sustained value energy, enhancing momentum indicators, or proof of earnings resilience pushed by AI adoption, earlier than contemplating contemporary publicity to the sector.
Q: India VIX is up 68% in a month and volatility is predicted to stay excessive going forward. How ought to one navigate this section?
With India VIX surging 68% in a month, buyers ought to prioritize capital safety. Concentrate on disciplined place sizing, keep away from aggressive leverage, and follow high-quality shares. Use rallies to scale back threat, preserve larger money ranges, and watch for volatility to chill earlier than taking directional bets.
Q: Olectra, JBM Auto and Jai Prakash Energy Ventures have been large gainers this week, whereas Chennai IDBI Financial institution, Bandhan Financial institution and BPCL have been large losers. What ought to buyers do with them?
Olectra Greentech
The inventory has witnessed a robust rebound from the lows of 865. Nevertheless, it stays in a broader downtrend since October 2025, and it’s nonetheless untimely to categorise the present transfer as a development reversal. For any significant upside traction, the inventory must maintain above the 980–975 zone.
JBM Auto
The inventory rebounded sharply from its key help zone of 490–470 earlier this week. That mentioned, it continues to face resistance close to its earlier swing excessive of 615–620. Except this zone is decisively breached, the present pullback can’t be thought of a confirmed development reversal.
Jaiprakash Energy Ventures
The inventory has delivered a downward-sloping trendline breakout on the each day chart, supported by an increase in volumes. Momentum indicators are turning constructive. RSI is trending larger, and the DI+ is comfortably above DI- on the ADX, indicating bullish undertones. The inventory wants to carry above the 14.5–14 zone to maintain the transfer. Nevertheless, being a penny inventory, it warrants a cautious method.
IDBI Financial institution
The inventory witnessed a pointy gap-down of practically 17% on sixteenth March and has continued to float decrease since then. RSI stays weak at round 25, highlighting persistent bearish momentum. So long as the inventory trades under the 80–82 zone, the broader development is prone to stay detrimental.
Bandhan Financial institution
The inventory has corrected practically 17% from its current excessive of 190 recorded on twenty sixth February. It continues to commerce under key shifting averages, whereas the MACD stays under each the zero line and sign line, indicating sustained weak point. The development is prone to keep bearish so long as the worth stays under 165–167.
BPCL
The inventory Bharat Petroleum Company slipped under its 200-day EMA on ninth March and has been underneath stress since. It has corrected practically 26% from its excessive of 390 on twenty seventh February. A rising ADX factors to strengthening bearish momentum. So long as the inventory trades under the 307–310 zone, the general development is predicted to stay weak.
(Disclaimer: The suggestions, recommendations, views, and opinions given by the consultants are their very own. These don’t symbolize the views of The Financial Instances.)
