Indian Stock Market Analysis: Nifty 50 Outlook for February 24, 2025
Domestic benchmark indices have shown persistent losses, closing lower for the fourth consecutive session on February 23, 2025. The 30-share BSE Sensex fell by 424.90 points to settle at 75,311.06, and the NSE Nifty 50 index dropped 117.25 points, marking its lowest close for 2025.
The decline is attributed to factors such as foreign fund outflows, weakening US markets, and looming tariff threats. Despite these challenges, the volatility index India VIX saw a slight decrease of 1.03 percent, landing at 14.53, indicating reduced market volatility.
Technically, the Nifty index is reflecting mixed signals. A small red candle was formed on the daily chart, whereas the weekly chart displayed a doji candle, signaling uncertainty among investors. Hrishikesh Yedve from Asit C. Mehta Investment Intermediates noted the Nifty Smallcap 100 and Nifty Midcap 100 indices had formed green candles on the weekly charts, indicating strong demand and potential areas of resilience.
Looking forward to February 24, analysts agree there is caution surrounding the market. According to Bajaj Broking's market commentary, the Nifty forms what is described as a bear candle and has broken below the last three-day low, continuing the previous bearish trend. Currently, the index resides near its lower band for the last five trading sessions, operating within the range of 22,700 to 23,050.
Market expert Yedve advised, “The 21-Day Simple Moving Average at 23,200 remains the immediate hurdle. A decisive move above this level could ignite fresh bullish momentum.”
Analysts at Kotak Securities, led by Amol Athawale, indicated the broader market remains weak. “We could expect a quick technical pullback rally if it successfully holds above 22,950/76000,” he added, warning about the potential for declines. If the Nifty breaks below the 22,700 level, the next potential downturn could see the index sliding to 22,500 and even 22,000.
Support levels are being closely monitored. If the index drops below the 22,700 support zone, it may initiate declines toward the levels of 22,500 to 22,400. Ajit Mishra from Religare Broking pointed out, “A decisive break below 22,700 could trigger the next leg down, likely bringing the index to 22,500. Near 22,400, contrarian traders may begin to reconsider, potentially taking long positions with strict stop-loss measures set at 22,320.”
A key highlight is how sectors like banking and IT are displaying relative strength during this correction phase. Their performance may play a significant role in determining the market's unfavorable trend. Investors should remain vigilant about these sectors, as they could help provide direction for the Nifty 50's next move.
For investors and traders, the market’s near-term outlook presents both risks and opportunities. Those positioned for continued market volatility might find these predictions valuable to inform their strategies moving forward.
Note: This analysis is intended for informational purposes only and isn't investment advice. Readers are urged to consult financial advisors before making any investment decisions.