Nifty Resumes Downtrend; volatility stays elevated as trend weakens
Dhupesh Dhameja,
Derivatives Research Analyst,
SAMCO Securities
Mumbai, March 27, 2026: Nifty witnessed renewed selling pressure and closed at 22,819.60, down 486.85 points (-2.09%), forming a strong bearish candle after facing rejection near the 10-DEMA on the daily chart, indicating that the pullback was short-lived and sellers remained active at higher levels.
Derivatives Analysis Report
Nifty: Weak Structure Below 23,000
The index slipped below 23,000–22,950, which now acts as immediate resistance. Sustaining below this zone keeps the bias weak, with downside support placed near 22,650–22,500, while a decisive break could extend the decline toward 22,300–22,200.
On the hourly chart, the index continues to trade below its falling 10 & 20 EMA, with a clear lower-high structure, highlighting persistent supply. Momentum indicators remain weak, with daily RSI sustaining below 40, reflecting bearish continuation gaining strength rather than a reversal. Additionally, India VIX holding above 25 level signals elevated volatility and supports the negative undertone.
From a broader perspective, the weekly chart indicates the index has slipped below its intermediate support zone, suggesting the broader structure remains fragile and rallies are likely to be sold into.
In derivatives, PCR around 0.89 reflects a cautious undertone. Strong call writing is visible at 23,000 and 23,200, capping the upside, while put writers are positioned near 22,500, marking it as immediate support. The options setup indicates a 22,500–23,200 range, with downside risk prevailing.
Going ahead, any bounce toward 22,950–23,050 may attract fresh selling, while a break below 22,650 could accelerate weakness toward 22,300. Until the index reclaims 23,200, sell-on-rise strategy is likely to dominate amid elevated volatility.
Nifty Bank's Trend Remains Fragile; 52,000 Key Level
Nifty Bank witnessed fresh selling pressure and closed at 52,274.60, down 1,433.50 points (-2.67%), forming a strong bearish candle on the daily chart and extending its lower-high, lower-low structure. The index faced rejection near the falling 10-DEMA and slipped below the 53,000–53,200 zone, which now acts as immediate resistance. Sustaining below this region keeps the undertone weak, with immediate support placed near 51,900–51,700, while a breakdown could accelerate the decline toward 51,200–50,800.
On the hourly chart, the index is forming a sequence of lower highs with price sustaining below short-term averages, reflecting weak intraday demand. The recent pullback lacked follow-through buying and momentum faded near resistance, suggesting that intraday bounces are being used to initiate fresh shorts, keeping the near-term bias tilted to the downside.
From a broader perspective, the weekly structure shows the index slipping below its prior consolidation base, indicating loss of upward momentum and a shift toward a corrective phase. The inability to hold above the previous breakout zone suggests that any pullback toward higher levels is likely to face distribution unless the index decisively reclaims the 54,500–55,000 zone.
In derivatives, PCR around 0.81 reflects a cautious-to-bearish undertone. Significant call writing is visible at 52,500 and 53,000, limiting upside potential, while put writers are concentrated near 52,000, marking it as the immediate support. The options positioning suggests a 52,000–53,000 range, with downside risk prevailing.
Going ahead, any bounce toward 52,800–53,300 is likely to face selling pressure, while a break below 51,900 could open the door toward 51,200–50,800. Until the index reclaims 53,200, sell-on-rise strategy is likely to dominate amid elevated volatility.
Om Mehra, Technical Research Analyst, SAMCO Securities
Technical Analysis Report
Nifty declines
Nifty ended the session at 22,819.60, declining 2.09%, as the index continued to remain under pressure and closed near the lower end of the day’s range. The index has now extended its weakness, marking the fifth consecutive weekly decline, with a weekly fall of 1.28%. Since the West Asia conflict broke out on February 28, Nifty is down by over 9%.
Nifty declined by 2,359.05 points, falling 9.37% from 25,178.65 to 22,819.60 between 27 February and 27 March.
Nifty has formed a bearish candle in the daily chart and continues to trade within a downward-sloping channel, indicating a sustained corrective phase. The recent rebound attempts have remained short-lived.
The index remains below its key short-term moving averages, reflecting the absence of strength in the current setup.
The RSI is placed near 35, indicating weak momentum, while the CCI continues to remain in negative territory, highlighting a lack of directional strength.
On the weekly timeframe, Nifty has registered its fifth consecutive week of decline, highlighting the ongoing weakness in the broader trend.
India VIX remains elevated at 26.80, indicating heightened volatility in the market. Meanwhile, USD-INR has weakened further, touching a low of 94.84, adding to the cautious undertone.
Going ahead, the 23,200–23,300 zone is likely to act as an immediate resistance area. Unless the index sustains above this range on a closing basis, recovery attempts may remain limited. On the downside, the 22,600–22,500 zone remains a key support area, and a break below this level may extend the ongoing decline. The current setup continues to reflect a corrective phase, with rebounds likely to face resistance at higher levels.
Nifty Bank ended the session at 52,274.60, declining 2.67%, as the index remained under pressure and failed to sustain the recovery seen in the previous few sessions. The weakness was broad-based, with both Nifty Private Bank and Nifty PSU Bank indices ending lower, indicating continued stress across the banking pack.
On the daily chart, the index has formed a strong bearish candle following the recent pullback attempt. The index is currently trading well below the 23.6% Fibonacci retracement level placed near 53,770, while the 38.2% level at 55,280 remains significantly higher.
The recent decline from the swing high continues to keep the structure weak, with lower highs and lower lows still visible on the hourly chart. The index is also placed well below its short-term moving average.
The RSI is placed near 33, indicating that the index is recovering slightly from the oversold zone. The MACD remains in negative territory.
The immediate hurdle is now placed around 53,700–53,800, which coincides with the 23.6% Fibonacci retracement zone.
Unless the index reclaims this band on a closing basis, the recovery may remain restricted. On the downside, 51,300 remains an important support zone, and a break below this level may open room for further weakness.
