Nifty outlook: Further dips possible before a move towards 25,100, says Anand James

The Nifty may see further volatility in the near term before resuming its upward trajectory, according to Anand James, Chief Market Strategist at Geojit Investments. With the index testing the 24,300–24,400 support zone, James expects further dips before a potential move towards 24,850–25,100.

He said a break below 24,170 could weaken the near-term structure and expose the index to 23,575. On Bank Nifty, James sees the ongoing consolidation as a base-building phase, with a decisive breakout likely only beyond the 57,100–58,000 range. He also identified Realty and PSU Bank as sectors that could lead, while cautioning against near-term weakness in Auto and Energy stocks.

Edited excerpts from a chat:


Nifty fell about 1% in the week as it tested the 24,300–24,400 support cluster. On the weekly chart, is this still a routine higher-bottom formation, or are we seeing the first credible signs of trend deterioration?
Nifty has been on a consolidation mode ever since pushing above the upper bollinger band early this month. This appears like a time correction, having scaled over +1000 points in just a week, towards the end of July. The 20 dma, now in the 24300 vicinity appears to provide support, but with momentum lacking, we feel that there might be further dips before a leap to 24850-25100 unfolds. Alternatively, inability to restrain dips to 24170, could expose 23575.

Bank Nifty remains trapped broadly between 57,100 and 58,000, with its major moving averages flattening. Is this consolidation constructive, or does the absence of banking leadership materially increase the probability of a breakdown?
The current setup still appears more constructive than outright bearish in the case of BankNifty. The index is approaching a rising trendline support, while the narrowing trading range suggests volatility compression ahead of a potential breakout move. The key concern remains the lack of participation from heavyweight constituents such as HDFC Bank and SBI, which has limited upside momentum and prevented banking from reclaiming market leadership. However, recent doji and reversal-type candles in HDFC Bank, ICICI Bank, Axis Bank and Kotak Mahindra Bank indicate early signs of a pullback attempt. Unless Bank Nifty decisively breaks below trendline support near 57,100, the current consolidation is best viewed as a base-building phase rather than a precursor to a major breakdown. BankNifty Option positioning remains range-bound, with the highest Call OI at 58,000 and significant additions at 57,500-58,000, reinforcing overhead resistance. On the Put side, strikes near 57,500-57,700 are being written suggesting support near current levels. The combination of fresh Call and Put writing points to continued consolidation, with a decisive move likely only on a breakout from the 57,100-58,000 range.

Based on weekly relative strength charts, which two sectors are positioned to lead next week, and which two should traders avoid?
Leaders: Nifty Realty Index is exhibiting early signs of a turnaround, with relative strength improving from 0.03 to 0.04 and holding steady in recent weeks, indicating improving market interest while Nifty PSU Bank Index has remained resilient with a stable RS profile in the 0.34-0.36 range, suggesting further improvement if momentum builds in the coming week.

Laggards: Nifty Auto Index, after a strong rally in recent months, is beginning to show signs of exhaustion as RS eased from 1.21 to 1.20, raising the possibility of near-term profit booking. On the other hand, Nifty Energy Index continues to underperform, with RS declining from 1.65 to 1.58 over the past few weeks, reflecting weakness relative to Nifty.

MCX shares jumped 10% amid positive news flow. Do you think the upmove is sustainable?
An evening star, which is a bearish reversal candle stick pattern has formed, pointing to hesitation, being near July peak. Oscillators are also easing. With these in the backdrop, we would recommend a fresh entry into the stock only on dips to 2880, with downside marker below 2800 or on direct rise above 3000.

Read Also: F&O Talk: Nifty consolidation to continue says Sudeep Shah; gives Tata Motors, Lenskart, Honasa strategy

TCS shares fell 4% in the week amid N Chandra's resignation as Tata Sons Chairman. Do you think this could be a buy opportunity at this stage?
The succession related events may take a longer time to unfold, and we do not see this as a trading opportunity. That said, the stock price is in a consolidation pattern, with 20 dma holding off lower extremity of the range. We don’t sense an urgency to enter right away, but dips to 2280 could improve the attractiveness.

Give us your top ideas of the week ahead.
GODREJAGRO (LTP: 580)

View: Buy
Target: 605-620
SL: 568

Godrej Agrovet has delivered a bullish breakout from its recent consolidation range, indicating a potential shift in trend. The stock has moved above its daily Supertrend resistance, while a positive MACD crossover points to strengthening momentum. RSI has improved to around 60, reflecting healthy buying interest and supporting the ongoing upmove. The breakout also marks a favorable structural development, suggesting renewed bullish participation. As long as the stock holds above 568, the positive setup remains intact. The stock may be bought with an upside potential towards 605-620 in the near term, while maintaining a strict stop loss at 568.

MARKSANS (LTP: 333)

View: Buy
Target: 360
SL: 317

Marksans Pharma has delivered a decisive breakout from a multi-week consolidation range, signalling the continuation of its primary uptrend. The stock has also broken out of a parallel trading channel, supported by a strong bullish Marubozu candle, reflecting aggressive buying interest. Importantly, the move is backed by a significant surge in weekly volumes, lending credibility to the breakout and indicating strong market participation. Momentum remains robust, with MACD showing a sharp positive crossover. The stock is now trading at fresh highs, suggesting the potential for further upside. As long as it sustains above 317, the breakout structure remains intact. Traders may consider accumulating the stock for a near-term target of 360, while maintaining a strict stop loss at 317.