The Indian stock market has achieved a disturbing milestone by logging losses for eight consecutive weeks for the first time in 25 years, surpassing the streaks seen during the 2020 Covid-19 crash and the 2008 global financial crisis. According to SBI Securities' Sudeep Shah, the Nifty's decline of around 8.74% over the past eight weeks is much lower than the roughly 22% decline in the comparable phase of 2008 and 33% in 2020. Historically, Nifty has delivered an average return of around 11% in one month, 12% in three months, 14% in six months and 39% in twelve months following such losing streaks. However, the current setup has some similarities with elevated crude, Strait of Hormuz-related disruption, rising global yields and persistent FII outflows, though the magnitude remains significantly lower than previous crises. As per LKP Securities' Senior Technical Analyst Rupak De, it is a tendency of the market to rise back higher after a contentious correction, with investors saying "Enough is enough" and this perception becoming contagious to lift the market like a phoenix rising from the ashes.
**LKP Securities' Senior Technical Analyst Rupak De emphasizes that the 22,600 level remains crucial for Nifty's near-term direction, with a sustained hold potentially triggering a pullback while a decisive breakdown would increase the risk of another leg lower. This aligns with previous analyst assessments, as Mirae Asset Sharekhan's Muthuselvaraj notes that weakness could trigger a move towards the lower-end of the channel at 22,200–22,300 in the short to medium-term. SAMCO Securities' Om Mehra had highlighted that support for the Nifty around 22,000-22,500 zone where the rising trendline from June 2024 meets the March low could be the last line of defence for the bulls. The technical analysis suggests that if Nifty sustains above 22,840, it could rally toward 24,800–25,500 levels, while Mehra expects the Nifty to trade between 22,000 and 24,800 over the next six months. However, LKP Securities warns that if Nifty fails to reclaim 22,600 decisively, it could eventually head towards 20,500, with the analyst noting that if it doesn't reclaim 22,600 anytime soon, the pain may persist and more correction may come below 22,200, which might be more severe.
The index has now breached its 200-week moving average for the first time since the Covid crash, marking a significant technical breakdown. As per *LKP Securities' Rupak De, this is not a normal breakdown, with historical precedent showing Nifty fell 27% after it slipped below the 200WMA in 2020, and 38% in 2008. However, in 2011, 2013 and 2016, Nifty broke below the 200WMA but reversed quickly after a 2–6% correction. The analyst advises cutting down on high long exposure as long as Nifty remains below 22,600 and adding back longs when Nifty moves back above 22,600 decisively. Market breadth has deteriorated sharply, with mid- and small-caps also coming under pressure, leading to massive FII outflows and FPI apathy towards the Indian market. The fall in the spread between the US and India 10-year bond yields is taking money away from the Indian market, with breadth having been weak for so many months which might remain weak in the days to come.
Foreign Institutional Investors have offloaded ₹43,687 crore in just six trading sessions, with outflows accelerating over the past three sessions. As per SBI Securities, their index futures long-short ratio has declined to 8.01%, near the lower end of its historical range. The ratio had fallen to 5.98% on September 30, 2025, after which Nifty rallied around 7.5% before reaching its January 2026 high of 26,373. However, since July 2025, the FII long-short ratio has largely remained within a 5–21% range, with no sustained improvement. A strong US dollar, elevated DXY and US bond yields above 5% could continue to deter foreign investors and keep FII selling as an overhang, suggesting that while extreme short positioning leaves room for a sharp rebound through short covering, a sustained recovery would likely require improvement in the global macro backdrop. In dollar terms, Nifty's performance has been even worse, leading to FPI apathy towards the Indian market.
IT stocks bounced back towards the end of Friday, with the 28,800–28,850 zone acting as immediate resistance for the sector. According to SBI Securities, the bearish bias is likely to persist below this level, while on the downside, 27,650–27,600 is the key support; a decisive break could extend the weakness. For PB Fintech, the stock has corrected nearly 48% in six sessions, significantly weakening its chart structure with MACD slipping below zero. Bajaj Auto declined 7.62% and closed below its 200-day EMA for the first time since April 2026, with RSI at 22 and widening DI lines indicating strong bearish momentum. Infosys has bounced from the ₹985–980 support zone, while TCS remains significantly below its key moving averages with rising ADX and RSI below 40 indicating strengthening bearish momentum. Auto stocks are showing weakness across the board, with most counters looking very weak and chances of breaking support looking higher, making avoiding the space advisable for the time being. As per LKP Securities, most of the auto stocks were not doing great in the recent past, with weakness already visible in most of the auto stocks, both four-wheelers and two-wheelers. Technically, auto stocks were not looking great, apart from very few, and weaker-than-expected sales numbers just amplified that view.
