Share Market Outlook: Investors lost lakhs of crores of rupees in the stock market this week. The Sensex has fallen by 4000 points this week. It has fallen from 82,133 to 78,041. Similarly, the Nifty-50 has fallen from 24,768 to 23,587. At the same time, the Nifty Bank Index has fallen from 53,583 to 50,759, a decline of 2,824 points. This week the major benchmark indices have lost four weeks of gains. The US Fed’s estimate of rate cuts only twice in 2025 and FII selling have led to this decline in the market. The Nifty-50 index has fallen below its 200-DEMA support. This may boost the morale of bears in the Indian stock market. Amid this selling, the Nifty-50 index is close to its recent swing low of 23,250 points. Now the focus of investors is on whether the Nifty 50 index will maintain this support or the index will touch a new low level.
Why is the market falling?
According to market experts, due to the Federal Reserve’s tough stance on rate cuts, bears had a chance to turn the Indian stock market red before Christmas. After the Fed’s signals, the US dollar rose sharply and reached a 2-year high. This triggered buying in the bond and currency market. Due to this, FII selling was seen in the Indian market. In such a situation, DII did not have the confidence to buy at lower levels.
Why are DIIs not able to do bottom fishing?
According to stock market expert Dr Ravi Singh, the global market has weakened after the Fed’s signals. This has strengthened the dollar in the foreign currency market. This led to fresh buying in the bond and currency market. DIIs did not appear confident due to the uncertainties after the weak earnings season, due to which the selling by FIIs proved to be more fatal. DIIs are waiting for Budget 2025. Therefore, they are expected to remain silent players. A sharp fall in the rupee increases macroeconomic concerns and uncertainty about recovery increases after a weak earnings season. These are some of the reasons due to which DIIs are not able to do bottom fishing (buying at lower levels).
Will the decline continue?
Nifty-50 index has closed below the important 200 period MA of 23,800 points. It broke the 4-week gain by closing near 23,600 points. Nifty-50 index has shown a short term correction from the zone of 24,850. Now the next important support is near the zone of 23,500 points. Below this the overall trend will become bearish. On the other hand, Bank Nifty index is near the important 200 period MA of 50,000 points. Below this the trend will become weak. Now the next big support is at the previous bottom, which is 49,800 points. Below this the trend will become bearish. After this the selling pressure may intensify further.
How will the market be on Monday?
According to Dr Ravi, the Indian stock market may remain quite volatile on Monday. Nifty has slipped below the crucial zone of 200 SMA, so the next potential support can be seen around the recent swing low, which is around 23,200 to 23,100. If this breaks, then Nifty will be likely to move towards 22,800. The strong bearish candle on the weekly charts definitely shows a turnaround move. As far as resistance is concerned, 23,800 to 24,000 can be seen as an intermediate hurdle. After this, resistance will be seen between 24,150 to 24,300.