Multiple days below 24,000 on the NIfty has lent a cautious bias to traders, who have been betting on an upswing, having witnessed extended period of consolidation. However, despite sub-24,000 trades, VIX remains near 10% and in fact saw a 5.6% decline on Friday, with 23,800 lending support.
Meanwhile, FIIs added to their index future short positions through the week; in tandem with Nifty’s decline to end the week at 2,69,527 contracts, the highest of the week, and an 18.8% increase on a week-on-week basis. So, not surprisingly, the long-to-short ratio of FII index future portfolio ended at 11.1, not very far from record lows.
However, some FIIs also boosted their longs, registering a near 40% increase on a week-on-week basis, lifting the total FII longs to 33,689 contracts, the highest since early July. This suggests that FIIs have taken a tactical position expecting upswings in the coming week.
Pharma Index slips below key support, further weakness likely
The Nifty Pharma Index has started to look technically vulnerable after slipping below the support line of its rising wedge pattern. This breakdown suggests that the medium-term bullish momentum may be fading, at least for now. Attention has now shifted to the 26,160 region, which is important because it aligns with both the 50-day moving average and a key horizontal support zone.
If the index fails to hold this level convincingly, the corrective move could extend further, with 25,500 emerging as the next area to watch. Momentum indicators are also leaning in favour of the bears.
The daily MACD has moved below its signal line, pointing to a loss of upward strength, while the RSI, currently around 49, remains below the neutral zone and still leaves room for additional downside. The weekly MACD has also started to flatten, which adds to the sense that the broader uptrend is losing some of its earlier conviction.
Unless the index is able to quickly reclaim the broken wedge support, any rebound is likely to run into selling pressure near the 26,800–26,850 resistance zone. For now, the short-term bias remains negative, with the risk tilted towards further corrective action rather than an immediate recovery.
FMCG Index nears crucial support amid oversold conditions
The Nifty FMCG Index continues to remain under pressure after extending its corrective phase, but it is now approaching an important support area around 45,400. This zone carries technical significance as it is close to a recent reversal area and also lies near the weekly Supertrend support.
The broader setup still remains weak, with the index trading below key resistance levels, but the proximity to support makes the next few sessions especially important.
That said, momentum indicators are beginning to suggest that the selling pressure may be close to exhaustion. The daily RSI has moved into oversold territory, while the MACD histogram is showing signs of tiring momentum.
This does not confirm a reversal by itself, but it does indicate that aggressive downside may start to slow, and bargain-hunting interest could emerge if the index manages to hold near support.
Several heavyweight FMCG names, including Hindustan Unilever, ITC, Varun Beverages and Britannia, are also trading close to important support levels and are showing oversold readings. This increases the possibility of a technical rebound, especially if broader market conditions remain stable and selling pressure does not intensify further.
While the near-term outlook remains cautious, the 45,400 zone will be critical to watch. A hold above this level could open the door for a relief bounce, though any recovery is likely to face resistance in the 45,800–47,680 range. On the other hand, a decisive break below support would weaken the structure further and could prolong the corrective trend.
About author
The author is Anand James, Chief Market Strategist at Geojit Investments.
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