That said, the decline from here could be gradual rather than panic-driven, owing to continued put writing and a fragile bullish stance among retail participants. Here is our detailed analysis:
Nifty 50
Nifty futures (April) (22,909), after opening last week on a weak note, witnessed a recovery mid-week. However, it failed to sustain as the contract faced resistance at 23,500 and resumed its decline.
There are no signs of a bullish reversal on the chart and price action suggests that the downtrend remains intact. With the nearest notable supports at 22,380 and 22,100, the probability of further decline from the current level is high. For the sentiment to improve, Nifty futures need to decisively surpass the resistance at 23,500.
Reinforcing the bearish bias, April futures have seen fresh short build-up — as the contract fell 1.6 per cent last week, the outstanding Open Interest (OI) more than tripled to nearly 147 lakh contracts.
On the options front, the Put-Call Ratio (PCR) of April options stood at 1 on Friday. While this appears neutral, significant call writing at the 23,000 strike (highest OI of 48,666 contracts) indicates that participants expect recoveries to be capped near this level.
On the downside, notable put OI is concentrated at 22,500 and 22,000 strikes with 26,737 and 42,176 contracts respectively, making these potential support levels.
Based on the aforementioned factors, Nifty futures is likely to remain under pressure in the near term. A breakout above 23,000, and more importantly 23,500, is required to turn the outlook bullish. Until then, traders can adopt a sell-on-rise strategy.
Strategy: Short Nifty futures (April) at 22,909 and on a rally to 23,300. Place stop-loss at 23,700. Revise the stop-loss to 22,850 when the contract falls to 22,500. Book profits at 22,100.
Nifty Bank
Nifty Bank futures (April) (52,547), after a sharp sell-off early last week, attempted a recovery. However, bulls failed to sustain momentum as the contract faced resistance at 54,500, following which it resumed its decline in line with the broader trend.
The underlying index has breached a key long-term trendline support at 53,450, strengthening the bearish outlook. The corresponding level for April futures stands near 54,000.
Adding to the bearish set-up, Nifty Bank futures has witnessed fresh short build-up — as the contract declined 2.6 per cent last week, the outstanding OI more than doubled to 18.3 lakh contracts.
The PCR of April options stood at 0.86 on Friday. A ratio below 1 indicates relatively higher call writing compared to puts, suggesting that participants are expecting a downside.
From a technical standpoint, the nearest support levels are at 50,800 and 50,000. Although 52,000 could act as an interim support due to notable put OI (17,860 contracts), the prevailing momentum increases the likelihood of this level being breached.
On the upside, 53,000 and 54,000 act as immediate resistance levels, followed by a strong barrier at 55,000. Only a decisive breakout above 55,000 can improve the outlook.
Overall, both price action and derivatives data suggest a continuation of the downward move in the near term.
Strategy: Short Nifty Bank futures (April) at 52,547 and on a rally to 53,600. Place stop-loss at 55,000. Revise the stop-loss to 52,250 when the contract falls to 51,000. Book profits at 50,000.
Published on March 28, 2026