Nifty 50 (24,450) and Bank Nifty (57,783) fell 2.9 per cent and 4.5 per cent respectively last week. The chart of index futures and the derivatives positioning show a bearish bias. Here is our analysis:

Nifty 50

Nifty futures (March) (24,546) opened with a gap-down last Monday. It extended the decline and made a low of 24,427 on Wednesday. While it attempted to rally, it could not reclaim the 25,000-mark.

The price action shows a clear bearish bias in Nifty futures. However, there is a potential support at 24,430. Given the current bearish momentum, the contract is likely to breach this level. In such a case, it can drop to 24,000.

On the other hand, if Nifty futures rallies from the current level of 24,546, it will face a resistance at 25,000. Even if the contract breaks out of this hurdle, it ought to surpass 25,500 to turn the outlook positive. Until then, the sellers might use higher levels to create fresh shorts, weighing on the contract.

In line with the chart’s bearish inclination, the futures has seen fresh short build-up. That is, as the March contract slipped 3.1 per cent last week, its outstanding open interest increased 10 per cent to 157 lakh contracts.

That said, the Put Call Ratio of March monthly options stood at 1.14 on Friday, showing a positive bias. A ratio greater than 1 is because of selling of relatively greater number of puts when compared to calls.

Overall, at the current juncture, the probability of a decline is high. But since there is a support ahead, traders might have to wait before going short afresh.

Strategy: Sell Nifty futures (March) if it slips below the support at 24,430. Target and stop-loss can be 24,000 and 24,630.

In case the March contract moves up to 24,800, initiate short. Target and stop-loss can be 24,000 and 25,100 respectively.

Nifty Bank

Nifty Bank futures (March) (58,079) began last Monday’s session with a considerable gap-down and witnessed an intraday decline. The bears dragged the contract further, particularly on Friday, when it lost 2.2 per cent in one session. For the week, it lost 4.6 per cent.

The price action shows the bears are holding the advantage and further decline is likely to occur. But before the next downswing, there could be a corrective rally, possibly to the 58,600-58,850 price band. So, after reaching these levels, the contract can resume the downtrend.

Once the fall resumes, Nifty Bank futures (March) can drop to 57,000. However, if it can break out of the barrier at 59,000, the outlook can turn positive. This can potentially lead to a rally to 60,000 and 60,500.

Supporting the bearish inclination, there has been a notable short build-up on Nifty Bank futures (March). Along with a 4.6 per cent decline last week, the outstanding open interest shot up by 46 per cent to 21.5 lakh contracts.

In addition, the PCR of March options on Nifty Bank stood at nearly 0.80 on Friday, a bearish sign.

Overall, the price action and the futures and options data hint at the likelihood of further fall. Hence, traders can consider going short.

Strategy: Wait for Nifty Bank futures to rise to 58,600 and then go short. Target and stop-loss can be 57,000 and 59,200 respectively.

Instead, if the March futures slips below 58,000, sell with a stop-loss at 58,300 for a target of 57,000.

Published on March 7, 2026