The three-day rally in the Indian markets saw a significant end on Friday, January 17, 2025 when a heavy decline was observed. The sensex dropped by 423.49 points equivalent to 0.55 percent a reduction from 76,619.33. In the same vein, the Nifty 50 index closed with a loss of 108.60 percent, at 23,203.20. The analysis indicates that the losses could extend to the next week which makes support and the resistance levels key dynamics into the next week.

For the Nifty 50 Key Support and Resistance Levels Analysis Nifty 50 Key Support and Resistance Levels

As Gedia Jatin, Technical Research Analyst, Mirae, Asset Sharekhan explains in his report with ET Now, the latest three-day counter trend saw a three day rally that showed up out of the blues, they were successful to show above the 23,390 which was the 40 hour moving average then. It was also mentioned that Nifty could slide to the18487 and then the psychological target of 18000 with a potential target lower than that at 17670. In case selling pressure is absorbed for some time, he predicts 23,100-23,300 tough area.

As explained in a report by ET Now, Rupak De noted that the negative sentiment prevailed on Friday, with the resistance still intact at 23,400. He further said, “If decisive Nifty breaks 23,000, a broader market correction could take place. However, the sentiment in the market can change through a higher movement above 23,400.”

According to Nagaraj Shetti, the Senior Technical Research Analyst at HDFC Securities, the daily chart showed a small negative candle with a tiny lower shadow indicating weakness in the bullish momentum that the trends has recently shown. “The gap down in Nifty from 13th January was a strong resistance. For the week, Nifty has a doji candle, which if confirmed would suggest a trend reversal,” he further explained in the ET Now report. Immediate support has been set at 23,100.

Chart Patterns and Expectations for the Week Ahead

After witnessing some strengthening, the observers noted a doji candle formation on the weekly chart which means indecision on the market part. Should this pattern be validated next week, that could constitute the possibility of a reversal opportunity. “Given that the Nifty index has registered a break in its last November’s low, it sets up the support zone for the upcoming week between 23000 and 22900,” Osho Krishan, Senior Analyst-Technical & Derivatives at Angel One, said. Other resistance lies in the range of 23500-23600 region, and the neckline is majorly at around 2350.

From the Falling Wedge pattern in the daily chart one can see important levels where the price is likely to recover. Yet they are united in one opinion, the violation of 23000 level will trigger a deeper correction.  

Market Analysis as of January 20, 2025

Although the general outlook remains negative, market analysts caution investors not to disregard key support and resistance levels. The buying interest may return if there is a strong break above 23400, otherwise the bears would take the market further down below 23000. Global factors, macro indicators, and company results will have a negative impact on the market performance in the near term.