28 May 2025 :“Nifty 50 Technical Outlook: RSI Divergence & Bollinger Squeeze Hint a Big Move ”
What Happened in Nifty in the last trading session?
On 27 May 2025, the Nifty 50 Index slipped by 174.95 points (-0.70%) to close at 24,826.20, after facing stiff resistance near the 25,250 zone. Despite a positive start, selling pressure emerged in the second half as global cues remained mixed and profit booking dominated frontline stocks. The market struggled to hold higher levels, and technical indicators reflected visible signs of fatigue with RSI divergence and narrowing Bollinger Bands.
Today's price action formed a weak closing near critical short-term support, increasing the probability of a directional move tomorrow. Let’s dissect the technical setup to see what could unfold in the next session.
Indicator-wise Analysis
1. RSI Divergence (14 Close)
- RSI currently at 57.63 — neutral but visible bearish divergence since early May.
- Price made higher high, RSI made lower high — classic topping pattern.
Verdict: Mild bearish bias
2. MACD (12,26 Close)
- MACD Line above Signal but converging quickly.
- Histogram weakening over last 5 sessions.
- Possible bearish crossover within 2–3 sessions.
Verdict: Weakening bullish momentum
3. Bollinger Bands (20,2)
- Price near upper band, failing to sustain.
- Consolidating below resistance, bands narrowing — sharp move expected.
- Break below middle band at 24,700 confirms breakdown.
Verdict: Neutral to Bearish if breaks 24,700
4. Stochastic RSI
- Currently around 65–70, moving down from overbought.
- Bearish crossover from overbought last week.
Verdict: Bearish short-term
5. Super Trend
- In active buy mode, trailing support at 24,670–24,700.
- A break below this flips bearish.
Verdict: Caution — crucial trailing support.
6. Chart Pattern
- Forming a Rising Wedge / Ascending Broadening Top.
- Bearish RSI divergence confirms exhaustion.
- Immediate breakdown level: 24,700
- Breakdown targets: 24,350 / 24,100
Verdict: Breakdown likely if 24,700 breached.
7. Moving Averages
- 20 DMA: 24,722
- 50 DMA: 23,768
- Price above all major MAs — bullish, but momentum indicators suggest exhaustion.
Verdict: Bullish structure, momentum fading
Breakdown Probability (Tomorrow — 28 May 2025)
| Scenario | Probability |
|---|---|
| Break below 24,700 | 68% |
| Test 25,250 resistance | 32% |
Trading View for Tomorrow
- If Nifty breaks 24,700 in first 30 mins: Intraday short towards 24,500 / 24,350.
- If holds above 24,800 till 11:00 AM: Likely sideways to mild upside — fade rallies near 25,000–25,250.
Conclusion — What to Expect Tomorrow
Based on the current technical setup, Nifty 50 appears vulnerable to a minor correction or range-bound move if it fails to sustain above the 25,250 resistance level. Key indicators like RSI bearish divergence, MACD flattening, and narrowing Bollinger Bands hint at rising market indecision. The probability of a breakdown below 24,700 in the coming session stands at around 65% if selling pressure persists, while a decisive move above 25,300 may invalidate this bearish bias and trigger short-covering rallies.
Traders are advised to adopt a cautious approach with a sell-on-rise strategy near resistance zones and consider deploying option strategies like bear put spreads or ratio spreads for expiry-day trades. Stay tuned for real-time updates and expiry special strategies on our blog.
Happy trading!
Disclaimer: For educational use only. Trade responsibly at your own risk.
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