Weekly Trend Report
- 28th Jul 2025
Week Gone By
The key equity indices ended the week in the red, weighed down by disappointing earnings, global uncertainties, and continued foreign institutional investor (FII) outflows. The week started on a strong note, supported by upbeat Q1 results. However, momentum weakened midweek due to weaker-than-expected IT earnings and stalled US-India trade negotiations ahead of the August 1 deadline. Consequently, the Nifty slipped below the 24,850 level, with broader indices underperforming sharply. On a positive note, India and the UK signed a landmark Free Trade Agreement on Thursday, aimed at boosting annual bilateral trade by $34 billion. As part of the deal, India will reduce tariffs on 90% of goods imported from the UK, while the UK will eliminate duties on 99% of Indian exports. The agreement is expected to benefit key sectors such as leather, textiles, electronics, and software, and also encourage fresh investments between the two countries.
Week Ahead
The domestic equity market may witness increased volatility in the coming week, influenced by a combination of global cues and the ongoing Q1FY26 corporate earnings season. Countries are expected to intensify trade negotiations with the US ahead of President Trump’s self-imposed August 1 deadline. On the domestic front, key economic data releases include India’s industrial production figures on Monday (July 28), the government’s fiscal balance for June on Thursday (July 31), and the July manufacturing PMI on Friday (August 1). Globally, China will release the NBS Manufacturing PMI on Thursday (July 31) and the Caixin Manufacturing PMI on Friday (August 1). In the US, numbers relating to job openings for June, GDP growth rate figures, and the Federal Reserve’s interest rate decision, all expected on Tuesday (July 29). Additionally, the Core PCE Price Index will be released on Thursday (July 31), followed by non-farm payroll data, the unemployment rate, and the manufacturing PMI on Friday (August 1).
Technical Overview
- Nifty has posted four consecutive weekly declines, reflecting growing bearish sentiment. The failure to attract sustained buying even after brief recoveries suggests that the short-term uptrend has likely paused.
- The 25,000–25,200 range has now emerged as a strong supply zone. Despite multiple intraday attempts, the index has been unable to hold above this psychological level.
- Nifty is currently hovering near a key short-term support at 24,500, marked by a previous demand zone and horizontal support. A breakdown below this may open the door toward the broader support cluster between 24,100–23,900.
- The Relative Strength Index has slipped to 40.71, now below the neutral 50 mark. This shift implies weakening bullish momentum, and suggests sellers are gaining control.
- ADX at 15.67 reflects a lack of strong trend, and indicates sideways to weak downward bias. The declining nature of the ADX line reinforces that current market moves lack conviction.
- The MACD has slipped into negative territory, with a bearish crossover below the signal line, and histogram values deepening in red.
- Price action is nearing the lower edge of the Ichimoku cloud, a key dynamic support zone. If Nifty decisively breaks below this cloud, it would indicate a trend reversal and attract further selling pressure.
- Nifty has broken below its 20-DMA, which has provided reliable support in recent months. This breach adds weight to the short-term bearish view and will likely prompt more unwinding unless the index reclaims this level swiftly.
- A visible formation of lower highs and lower closes on both daily and weekly timeframes marks a classic sign of trend exhaustion. Unless Nifty surpasses the last swing high convincingly, the index may continue forming lower levels.
- Conclusion:
Nifty is showing signs of exhaustion after multiple failed attempts to scale above 25,000. The broader trend remains intact but near-term momentum has clearly weakened. As long as Nifty stays below the 25,200 mark, upside remains capped. A decisive breach below 24,500 could intensify the correction toward 24,100–23,900. Indicators like RSI, MACD, and ADX support a cautious-to-bearish stance in the short term.
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