Weekly Trend Report
- 17th March 2025
Week Gone By
The domestic equity indices ended the week with moderate declines as investor sentiments remained subdued due to sustained selling by Foreign Institutional Investors (FIIs) in Indian markets. Market caution was further fueled by concerns over US President Donald Trump’s trade policies, particularly his recent decision to impose import tariffs on steel and aluminum, which prompted retaliatory measures from the European Union (EU) and Canada. Additionally, fears of a potential US recession added to the overall uncertainty. Globally, China’s consumer inflation turned negative for the first time in 13 months due to seasonal distortions and broader economic challenges, while U.S. CPI rose 2.8% year-on-year in February, easing from January’s 3% increase.
Week Ahead
The domestic stock market is expected to remain influenced by the global trends in the coming sessions. Investor sentiment continues to be weighed down by concerns over inflation, interest rate hikes, and geopolitical uncertainties. Adding to the unease, fresh apprehensions about US President Donald Trump’s proposed reciprocal tariffs have further fueled the sell-off. With FIIs playing a crucial role in India’s market movements, their actions will be closely watched. If FIIs continue to withdraw significant funds, heightened volatility may follow. On the economic front, India’s wholesale price index (WPI)-based inflation data for February is set to be released on March 17, 2025. On the global front, China’s industrial production and retail sales figures for January-February, along with US retail sales data are scheduled for March 17, 2025.
Technical Overview
- Weekly Decline Continues – NIFTY remained under selling pressure, closing at 22,397.20, reflecting continued weakness in the broader market.
- Resistance at 22,610, Key Breakout at 22,800 – The index faced resistance at 22,610, but for a structural trend reversal, NIFTY must break and sustain above 22,800. Failure to do so may keep the market under pressure.
- Lower Highs Signal Weakness – The formation of lower highs indicates that sellers are still in control, keeping the short-term trend bearish.
- Crucial Support Zone at 22,100–22,000 – The index found buying interest near 22,104, reinforcing this range as a critical support zone. A breakdown below 22,000 could accelerate selling pressure.
- Moving Averages Indicate Bearish Bias – Trading below the 50-day moving average suggests that the short-term trend remains under pressure, with upside attempts facing supply.
- Momentum Indicators Show Weakness – The Relative Strength Index (RSI) at 37.99 suggests weak momentum, though it is nearing oversold levels where a short-term rebound could occur. MACD Signals Downward Momentum – The MACD histogram remains in negative territory, confirming the prevailing bearish trend.
- Volume Analysis Reflects Selling Pressure – Higher volumes on down days indicate strong distribution, reflecting a lack of aggressive buying at lower levels.
- Parabolic SAR Confirms Bearish Outlook – The Parabolic SAR dots above the price further validate that the trend remains downward for now.
- Conclusion: For a potential trend reversal, NIFTY must break and hold above 22,800. On the downside, a breach of the 22,100–22,000 support zone could intensify selling pressure.
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