Nifty 50 - Analysis

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NIFTY MONTHLY VIEW - The psychology of the investment cycle. Await the monthly pullback before making any fresh investments. An essential read.


 Hello everyone, 

I advise everyone not to short when the Nifty falls below 22000 on April 7, 2025, as a bounce was anticipated. The market will grow, but investors shouldn't try to purchase equities, I stated. This is available on my Twitter account.

My definition of investment- my money get atleast doubled or I hold this for 4-5 years.

Regarding this, I had some questions on whether I should advise investing now or not. Since now is the ideal moment, I'm doing my best to respond to this.

First, the monthly chart is shown above. As a technical analyst, I used to view indications and their patterns over the previous twenty-five years or so. I comprehend the actions. Additionally, I believed that we should examine the index and investment from a psychological perspective, more so than any technical data.

To be honest, you have to make an effort to comprehend what charts are telling you. Verification of biasing is quite simple. Avoid biasing. let me talk to few points. 

 Foreign Institutional Investors (FIIs) have been reducing their percentage holdings in Indian equities over recent years. As of March 31, 2025, FIIs held a 17.22% stake in companies listed on the National Stock Exchange (NSE), marking a decline from 20.71% a decade ago.

  • This reduction in FII holdings has been accompanied by a significant increase in investments from Domestic Institutional Investors (DIIs). In the March 2025 quarter, DIIs' shareholding rose to 17.62%, surpassing that of FIIs for the first time in over two decades. This shift reflects a growing trend of domestic investors playing a more prominent role in the Indian equity market.

    The decline in FII holdings can be attributed to several factors, including global economic uncertainties, high valuations in Indian markets, and a slowdown in earnings growth. Conversely, the rise in DII participation is supported by increased inflows from mutual funds, insurance companies, and pension funds, driven by a surge in retail investor interest in equities

    While FIIs remain significant participants in the Indian market, the current trend indicates a relative decrease in their shareholding, highlighting a shift towards greater domestic ownership in Indian equities.

Unfortunately, my response to the question of where smart money is going is not particularly positive when it comes to India. Date-wise or short-term data might be misleading, so avoid looking at them.

For their quick and lucrative escape, the FII is the one inciting your irrational optimism. When choosing stocks, exercise caution.

Second, can you say that the market has ever corrected following COVID based on the monthly chart above? No, not at all. According to the current pattern, we are currently in the third month of a rise after five months of a decline.
Oh no! May is the third month, and the Nifty's starting quote is 24311. It is May 7, 2025. You all know how unstable the world is at the moment.
Furthermore, have we observed any transactions above 24800? No. Why?


Here is my conclusion, along with a warning.
We might witness a decline if the Nifty declines without surpassing 24800. We are almost at 24415 when I write this (far off the low of 21740 and the top so far at 24589).

Anyone may be surprised by the size of this dip. Indeed, I am predicting that 21740 will be breached, allowing Nifty to test levels between 20,000 and 19,000, roughly. I can declare it fixed if that occurs. Why should I invest now? Okay, whether or not that figure has arrived, one shouldn't adhere to levels. My focus is on the investing cycle and value.

I have to admit that I take data for trading hour by hour and day by day. in order for me to stand out if I am bullish at a particular moment.

Finally, I'm referring to a correction on the monthly chart, not market chaos. To see the outcome, at least wait three months. Who knows if the intended correction will occur sooner? I'll at least take my time,

So, I am saying a possible fall or correction from 24400 to 20000????
Somewhat yes !!!

Thanks for reading !!!
I’m Praveen Kumar, a seasoned Technical Analyst and stock market trader with over 25 years of experience in the Indian equity and derivatives markets. My passion for numbers and patterns led me to a dual career as a Mathematics Teacher and market technician. I specialize in Technical Analysis, with deep expertise in Elliott Wave Theory, derivatives strategies, and market forecasting. Over the years, my analysis and market views have been featured on NDTV Profit as a financial guest, along with published articles on reputed financial web portals, sharing insights on Nifty 50, Bank Nifty, and stock market trends. As a trader and analyst, I focus on interpreting price action, chart patterns, wave counts, and technical indicators to deliver precise market levels and actionable trade ideas. My approach blends classical charting with modern analysis tools to help traders navigate market volatility. Through VieCapital, I aim to share daily market analysis, trading strategies, and educatio…
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