Technical Analysis for 18 July 2025
Technical analysis is a powerful tool used by traders and investors to predict future price movements based on historical data, primarily price and volume. Unlike fundamental analysis, which evaluates a company’s financial health, technical analysis focuses on chart patterns, candlestick formations, and technical indicators like moving averages and the Relative Strength Index (RSI). For the Indian stock market, particularly indices like Nifty and Bank Nifty, technical analysis provides critical insights into market trends and trading opportunities. This article offers a detailed technical analysis for July 18, 2025, focusing on Nifty and Bank Nifty, with actionable trading strategies for Option Matrix India readers. Check previous analysis
Today’s Price Movement (July 17, 2025)
On July 17, 2025, the Indian stock market exhibited volatility, closing on a bearish note. The Nifty index opened at 25,230.75, reached a high of 25,238.35, dropped to a low of 25,101.00, and closed at 25,111.45, down 100.60 points from the previous close of 25,212.05. Similarly, Bank Nifty opened at 57,231.95, hit a high of 57,262.85, fell to 56,780.15, and closed at 56,828.80, a decline of 340.15 points from its previous close of 57,168.95.
This downward movement suggests selling pressure, with the market unable to sustain its opening gains. Several global cues contributed to this sentiment:
- Crude Oil Prices: Increased from $66.2 to $66.7 per barrel, potentially raising concerns about inflation and import costs in India.
- Indian Rupee: Depreciated from 85.93 to 86.08 against the US Dollar, impacting companies with foreign currency exposure.
- European Markets: Displayed a flat to bullish trend, offering mixed signals.
- Dow Futures: Remained flat, indicating uncertainty in US markets.
Our previous market prediction for July 14, 2025, as published on Option Matrix India, accurately forecasted key levels, demonstrating the reliability of our technical analysis approach. This success underscores the importance of monitoring price action and key levels for informed trading decisions.
Key Observations of Market Closing
The closing data for July 17, 2025, reveals bearish candlestick patterns for both Nifty and Bank Nifty, indicating potential weakness in the market. Below is a detailed analysis of the candlestick patterns observed:
Nifty Candlestick Analysis
The Nifty’s daily candlestick for July 17, 2025, is characterized by:
Parameter | Value |
|---|---|
Open | 25,230.75 |
High | 25,238.35 |
Low | 25,101.00 |
Close | 25,111.45 |
This forms a red candle (close below open) with:
- Body: 119.3 points (Open - Close = 25,230.75 - 25,111.45)
- Upper Shadow: 7.6 points (High - Open = 25,238.35 - 25,230.75)
- Lower Shadow: 129.75 points (Open - Low = 25,230.75 - 25,101.00)
The small upper shadow suggests limited buying interest at the highs, while the longer lower shadow indicates buying support at lower levels, though insufficient to push prices above the open. This pattern resembles a hanging man, a bearish reversal signal if it appears after an uptrend. Without prior trend data, we interpret it as a sign of continued selling pressure unless support levels hold.
Bank Nifty Candlestick Analysis
For Bank Nifty, the daily candlestick is:
Parameter | Value |
|---|---|
Open | 57,231.95 |
High | 57,262.85 |
Low | 56,780.15 |
Close | 56,828.80 |
This also forms a red candle with:
- Body: 403.15 points (Open - Close = 57,231.95 - 56,828.80)
- Upper Shadow: 30.9 points (High - Open = 57,262.85 - 57,231.95)
- Lower Shadow: 451.8 points (Open - Low = 57,231.95 - 56,780.15)
Similar to Nifty, the small upper shadow and longer lower shadow suggest that buyers attempted to defend lower levels but were overwhelmed by sellers. This pattern also aligns with a potential hanging man, indicating bearish sentiment.
Understanding Candlestick Patterns
Candlestick patterns are a cornerstone of technical analysis, offering insights into market sentiment. Each candlestick represents the open, high, low, and close prices for a specific period. Common patterns include:
- Doji: Indicates market indecision with nearly equal open and close prices.
- Hammer: A bullish reversal pattern with a small body and long lower shadow, often seen at the bottom of a downtrend.
- Hanging Man: A bearish reversal pattern with a small body and long lower shadow, typically after an uptrend.
- Engulfing Patterns: Signal potential reversals when one candle engulfs the previous one’s body.
The hanging man-like patterns observed in Nifty and Bank Nifty suggest caution, as they may indicate a reversal or continuation of bearish momentum, depending on the preceding trend and confirmation from subsequent candles.
Global Cues and Their Impact
Global economic factors significantly influence the Indian stock market. On July 17, 2025, the following cues were notable:
- Crude Oil Prices: The rise from $66.2 to $66.7 per barrel could pressure India’s economy, increasing import costs and potentially fueling inflation.
- Indian Rupee: The depreciation to 86.08 against the US Dollar may negatively impact companies with foreign debt or imports.
- European Markets: A flat to bullish trend suggests cautious optimism, potentially providing some support to Indian markets.
- Dow Futures: Flat performance indicates uncertainty, which may lead to a neutral opening for global markets.
These mixed signals contributed to the volatility observed, with domestic selling pressure amplified by global uncertainties.
Nifty Predictions
Based on the provided trading strategy, the following levels are critical for Nifty on July 18, 2025:
Scenario | Condition | Targets |
|---|---|---|
Bullish | 15-minute candle closes above 25,202 | 1st: 25,255, 2nd: 25,330, 3rd: 25,434 |
Bearish | 15-minute candle closes below 25,101 | 1st: 25,000, 2nd: 24,930, 3rd: 24,825 |
Short if False Breakout | Crosses 25,202 but closes below | 1st: 25,100, 2nd: 25,050 |
Long if False Breakdown | Crosses 25,101 but closes above | 1st: 25,200, 2nd: 25,255 |
- No-Trading Zone: The range between 25,101 and 25,202 is considered a consolidation zone where traders should avoid initiating positions due to lack of clear direction.
- Trading Rule: Avoid bullish trades in bearish candles and bearish trades in bullish candles to align with the market’s momentum.
Traders should monitor 15-minute candlestick closes to confirm breakouts or breakdowns, using stop-loss orders to manage risks. For example, a close above 25,202 could signal a bullish trend, while a close below 25,101 may indicate further downside.
Bank Nifty Predictions
While specific levels for Bank Nifty were not provided, we can infer key levels based on the day’s trading range:
Level | Value | Type |
|---|---|---|
Support | 56,780.15 | Immediate |
Resistance | 57,262.85 | Immediate |
Secondary Support | 56,500.00 | Psychological |
- Bullish Scenario: A 15-minute candle closing above 57,000 could indicate strength, with potential targets at 57,262.85 and higher resistance levels.
- Bearish Scenario: A close below 56,780.15 may lead to further declines, targeting 56,500 or lower support levels.
Traders can apply a similar strategy as for Nifty, monitoring 15-minute candles and aligning trades with the candlestick’s direction.
Tomorrow’s Market Prediction (July 18, 2025)
For July 18, 2025, the market’s direction will hinge on early trading patterns and global developments. Given the bearish close on July 17, there is a risk of continued selling pressure. However, the longer lower shadows in both Nifty and Bank Nifty candlesticks suggest buying interest at lower levels, which could lead to a bounce if supports hold.
- Bullish Case: If Nifty opens above 25,111.45 and closes above 25,202 on a 15-minute candle, it could target 25,255 and beyond. For Bank Nifty, a close above 57,000 could signal bullish momentum.
- Bearish Case: An opening below 25,111.45 for Nifty, with a 15-minute close below 25,101, may push prices towards 25,000. For Bank Nifty, a break below 56,780.15 could target 56,500.
Overnight global market movements, particularly in the US and Asia, will influence the opening sentiment. Traders should watch for any significant news, such as corporate earnings or economic data releases, that could impact the market.
Trading Strategies for July 18, 2025
To navigate the market effectively, consider the following strategies:
- Nifty Trading Plan:
- Long Positions: Enter if a 15-minute candle closes above 25,202, targeting 25,255, 25,330, and 25,434. Set a stop-loss below 25,101.
- Short Positions: Enter if a 15-minute candle closes below 25,101, targeting 25,000, 24,930, and 24,825. Set a stop-loss above 25,202.
- Intraday Monitoring: Watch for false breakouts or breakdowns and trade only in the direction of confirmed candlestick patterns.
- Bank Nifty Trading Plan:
- Long Positions: Consider if a 15-minute candle closes above 57,000, targeting 57,262.85 and higher resistances.
- Short Positions: Consider if a 15-minute candle closes below 56,780.15, targeting 56,500.
- Risk Management: Use stop-loss orders to protect against adverse movements.
- General Guidelines:
- Avoid trading in the no-trading zone (25,101–25,202 for Nifty).
- Align trades with the candlestick’s direction to minimize risk.
- Stay updated on global market developments overnight.
Importance of Technical Analysis
Technical analysis empowers traders to make data-driven decisions by identifying trends, support and resistance levels, and potential reversal points. By combining price action analysis with indicators and patterns, traders can anticipate market movements and manage risks effectively. For the Indian stock market, where volatility is common, technical analysis is particularly valuable for short-term traders and investors seeking to capitalize on price fluctuations.
Final Verdict
The technical analysis for July 18, 2025, suggests a cautious approach due to the bearish close on July 17, 2025. However, the presence of buying interest at lower levels indicates potential for a reversal if key supports hold. Traders should focus on the identified levels for Nifty (25,101 and 25,202) and Bank Nifty (56,780.15 and 57,262.85), using 15-minute candlestick closes to guide their trades. Combining technical analysis with global cues and disciplined risk management will be key to navigating the market successfully.
Disclaimer
The information provided in this article is for educational purposes only and should not be considered financial advice. Trading in the stock market involves risks, and individuals should conduct their own research or consult a financial advisor before making investment decisions.