Nifty Drops 2.5% as VIX Rises 24% – Volatility Remains High, Traders Cautious

The markets ⁣witnessed a corrective ‍move in a volatile week while ending lower. Nifty trended lower throughout the week and ended on a ⁤negative ⁢note. The index oscillated in a wide intra-week range of 733 points as it moved between 25,653 and 24,919. India VIX surged sharply by 24.80% to 14.19, indicating​ a sudden spike​ in risk perception and ⁤uncertainty. Nifty ended the week with a net loss of 645.70 points or -2.51%.

The current technical structure ‌of‌ Nifty reflects a important breakdown. ‌After failing to confirm a‍ breakout, the Index has slipped below the trendline that was drawn from the high formed in September 2024. It has also slipped below the‌ short-term 20-week moving average ​and now hovers near the lower Bollinger Band.‍ The lower Bollinger ‌band also aligns with the 50-week MA ​placed​ at 24758.

The‌ region of 25,000–25,150, which includes the 200-DMA on the ⁣daily chart and a key‍ support, is being tested. If⁢ this zone is violated convincingly, it may trigger a deeper corrective move.Conversely, any bounce would remain ​vulnerable unless the ⁣index reclaims the 25,650 levels.
Given the steep correction and a mildly oversold setup on the daily chart, the coming week, shortened by the⁣ Republic Day holiday on Monday, may see a tentative start with a ⁤possible technical rebound. However, volatility is expected to stay elevated as Tuesday also marks the monthly F&O expiry. as ⁢the markets would open after⁢ a ⁢gap of one day, they⁢ would also adjust to⁢ the prevailing global trade setup.