Nifty levels to watch as volatility may rise next week; eyes on US–Iran tensions

Nifty on Friday formed lower-high lower low and a bullish candle on the daily chart with long upper wick, suggesting selling at higher levels. Analysts are cautious and see higher market volatility next week. They said the 50-pack index is positioned in a cluster of key short-term moving averages namely 20-, 50- and 100-EMAs in the 25,580–25,680 range. The area is critical for determining the next directional move, they said.  

Nifty levels to watch

Rupak De, Senior Technical Analyst at LKP Securities said Nifty index found support around the previous low while facing resistance at the 21-EMA on the daily chart. "The RSI remains in a bearish crossover, suggesting weak momentum. India VIX stayed volatile, keeping participants on their toes. Over the next few days, higher volatility can be expected, with the index likely to oscillate in the 25,300–25,800 range. Immediate support is placed at 25,500, while immediate resistance is seen at 25,650," De said.

Ponmudi R, CEO of Enrich Money sees immediate support for Nifty at 25,500, followed by a stronger cushion at 25,400–25,380. "On the upside, 25,660–25,700 remains the near-term resistance zone, and only a sustained move above 25,700–25,800 would pave the way for renewed bullish momentum toward 26,000. Momentum remains neutral with RSI hovering around 48–50, suggesting a range-bound setup with a mild positive bias as long as the 25,500 support holds firm," he said.

Sectors to watch

Ajit Mishra, Senior VP for Research at Religare Broking maintained cautious stance and recommend closely monitoring of global developments in the absence of any fresh domestic triggers. 

"On the index front, sustaining above the 25,400 level is crucial to preserve a positive bias amid ongoing consolidation; a breach below this mark could turn the tone negative. We reiterate our preference for banking, auto, metal, and energy stocks for long positions, while advising against taking short-term positions in the IT space," he said.

Key developments to track
Siddhartha Khemka - Head of Research, Wealth Management at Motilal Oswal Financial Services said rising US–Iran tensions elevated geopolitical risks, pushing Brent crude higher to $71.8 per barrel, extending its three-day gain to 6.6 per cent. 

"This will be the key monitorable event in the near term and will provide direction to the market. Meanwhile, US headline CPI for January 2026 eased to 2.4 per cent year-on-year, which was better than expectations, signalling continued moderation in inflationary pressures. Market is likely to consolidate next week, tracking the geopolitical development along with the signing of India-US trade deal, India Q3 GDP data, US initial Jobless claims and conclusion of the AI summit," he said.