Technical Analysis for 22 July 2025

Technical Analysis for 22 July 2025

Welcome to Option Matrix India’s in-depth technical analysis for July 22, 2025. This article provides a comprehensive overview of the Indian stock market’s performance on July 21, 2025, focusing on the Nifty 50 and Bank Nifty indices. We analyze today’s price movements, candlestick patterns, and global cues, while offering precise trading strategies for tomorrow. 

Today’s Price Movement

On July 21, 2025, the Indian stock market closed on a bullish note, driven by strong buying interest. The Nifty 50 index opened at 24,999, touched a low of 24,882.3, reached a high of 25,111.4, and closed at 25,090.7, up 122.3 points from the previous close of 24,968.4. This performance indicates robust demand, with the index closing near its daily high, signaling sustained bullish momentum.

Similarly, the Bank Nifty index showcased strength, opening at 56,558.9, ranging between 56,255.7 and 56,983.45, and closing at 56,952.75, a gain of 669.75 points from the prior close of 56,283. The banking sector’s performance underscores positive sentiment, likely driven by favorable domestic and global factors.

Today’s Candlestick Pattern

The Nifty 50 formed a bullish candlestick on July 21, characterized by a significant lower wick. 

• Open: 24,999
• Close: 25,090.7
• High: 25,111.4
• Low: 24,882.3
• Body: 91.7 points (close - open)
• Lower Wick: 116.7 points (open - low)
• Upper Wick: 20.7 points (high - close)

This pattern, with a larger lower wick and a small upper wick, suggests that sellers initially pushed the price down, but buyers stepped in aggressively, driving the index higher. The gap-up opening (from 24,968.4 to 24,999) further indicates strong bullish sentiment at the start of the session. While not a classic hammer due to the absence of a clear downtrend, this candle reflects buying support and potential for continued upward movement.

For Bank Nifty, the candlestick was also bullish:

• Open: 56,558.9
• Close: 56,952.75
• High: 56,983.45
• Low: 56,255.7
• Body: 393.85 points
• Lower Wick: 303.2 points
• Upper Wick: 30.7 points

The larger body and significant lower wick indicate strong buying pressure, with the index recovering from intraday lows to close near its high. This reinforces the bullish outlook for the banking sector.

Key Observations of Market Closing

The market’s performance on July 21, 2025, provides several insights:

• Nifty 50 Performance: The index gained 122.3 points, closing at 25,090.7, reflecting strong bullish momentum. The close near the day’s high suggests buyers maintained control throughout the session.
• Bank Nifty Strength: With a 669.75-point gain, Bank Nifty outperformed, closing at 56,952.75. This indicates robust participation from banking stocks, a key driver of market sentiment.
• Global Cues:
  • Crude Oil: Prices fell from $68.3 to $65.85 per barrel, a positive development for India, an oil-importing nation, as it may reduce inflationary pressures and support sectors like automobiles and aviation.
  • Rupee Movement: The Indian rupee weakened slightly from 86.18 to 86.31 against the US dollar, potentially benefiting export-driven sectors like IT and pharmaceuticals while increasing costs for import-reliant companies.
  • Global Markets: European markets were flat to bearish, with the EU50 index down 0.21% at 5,348 points (tradingeconomics.com). Conversely, Dow Jones futures indicated a bullish trend, suggesting positive sentiment in the US markets.
• Market Breadth: The bullish close of both indices suggests more stocks advanced than declined, indicating broad-based buying interest.

Nifty Predictions

The Nifty 50 is at a critical juncture, testing key resistance levels. Based on our technical analysis, here are the levels to watch for July 22, 2025:

• Resistance: The immediate resistance is at 25,106. A 15-minute candle close above this level signals a bullish breakout, with potential targets at:
  • 1st Target: 25,180
  • 2nd Target: 25,255
  • 3rd Target: 25,330
• Support: Key support lies at 24,995. A 15-minute candle close below this level indicates bearish momentum, with targets at:
  • 1st Target: 24,930
  • 2nd Target: 24,850
  • 3rd Target: 24,740
• False Breakouts: If the index crosses 25,106 but closes below it on a 15-minute chart, it may signal a false breakout, offering a shorting opportunity with targets at 25,000 and 24,930. Conversely, if it crosses 24,995 but closes above it, look for upside targets at 25,100 and 25,150.

Technical Indicators

Assuming the Nifty is trading above its 20-day and 50-day moving averages, the short- and medium-term trends appear bullish. Traders should monitor:

• Relative Strength Index (RSI): Watch for overbought conditions (above 70) or bearish divergences, which could signal a potential reversal.
• Volume: A breakout above 25,106 with high volume strengthens the bullish case, while low volume may indicate a false move.
• Moving Averages: The 20-day and 50-day moving averages provide dynamic support levels, likely around 24,900-24,950, aligning with our support zone.

Traders should use the 15-minute chart to confirm entries and exits, ensuring alignment with the overall trend. Avoid trading counter to the candle’s direction (no bullish trades in bearish candles, no bearish trades in bullish candles).

Bank Nifty Predictions

Bank Nifty’s strong performance suggests continued bullishness, but key levels must be monitored:

• Resistance: The immediate resistance is at 57,000, close to the day’s high of 56,983.45. A break above this level could target:
  • 1st Target: 57,200
  • 2nd Target: 57,500
• Support: Key support is at 56,500, followed by 56,250. A 15-minute candle close below 56,250 may lead to:
  • 1st Target: 56,000
  • 2nd Target: 55,800

Trading Strategy

Apply the same 15-minute candle strategy as for Nifty. A close above 57,000 signals a buy, while a close below 56,250 indicates a sell. Monitor volume and momentum indicators like RSI to confirm breakouts. The banking sector’s strength suggests potential leadership in driving market trends, but caution is advised near resistance levels.

Tomorrow’s Market Prediction

For July 22, 2025, the market is likely to open with focus on the no-trading zone for Nifty between 24,995 and 25,106. Traders should avoid initiating positions within this range to minimize the risk of whipsaws. Here’s the detailed strategy:

• Bullish Scenario:
  • Condition: 15-minute candle closes above 25,106.
  • Action: Buy with targets at 25,180, 25,255, and 25,330.
  • Stop-Loss: Place below 25,106 or the recent swing low.
• Bearish Scenario:
  • Condition: 15-minute candle closes below 24,995.
  • Action: Sell with targets at 24,930, 24,850, and 24,740.
  • Stop-Loss: Place above 24,995 or the recent swing high.
• False Breakouts:
  • If Nifty crosses 25,106 but closes below it, short with targets at 25,000 and 24,930.
  • If it crosses 24,995 but closes above it, buy with targets at 25,100 and 25,150.

For Bank Nifty, monitor the 57,000 resistance and 56,500 support levels, applying similar 15-minute candle strategies. Avoid trading against the candle’s direction to reduce risk.

Impact of Global Cues

Global factors played a significant role in today’s market dynamics:

• Crude Oil Prices: The decline from $68.3 to $65.85 per barrel is favorable for India, potentially boosting sectors like automobiles, aviation, and consumer goods by reducing input costs. This may have contributed to the bullish sentiment (tradingeconomics.com).
• Rupee Movement: The rupee’s slight depreciation to 86.31 from 86.18 against the USD could benefit export-oriented sectors like IT and pharmaceuticals but may pressure import-dependent companies (wise.com).
• Global Markets: European markets’ flat to bearish performance contrasts with bullish Dow Jones futures, creating mixed signals. The US market’s optimism may influence a positive opening for Indian markets (investopedia.com).

Traders should stay updated on global developments, as they can impact market volatility.

Risk Management

Effective risk management is crucial in volatile markets:

• Stop-Losses: Always use stop-loss orders. For bullish trades above 25,106, place a stop-loss below 25,106 or the recent swing low. For bearish trades below 24,995, set a stop-loss above 24,995.
• Position Sizing: Risk no more than 1-2% of your capital per trade to protect against unexpected moves.
• Confirmatory Signals: Use volume, RSI, or candlestick patterns to confirm breakouts, reducing the risk of false signals.

Upcoming Events

Traders should monitor upcoming events that could influence the market:

• Economic Data: Inflation data, interest rate decisions, or geopolitical developments could drive volatility.
• Global Markets: US market performance, particularly after bullish Dow futures, will be critical.

Final Verdict

The Indian stock market is poised at a critical level, with Nifty testing resistance at 25,106. A breakout above this level could signal further gains, while a breakdown below 24,995 may trigger a correction. Bank Nifty’s strength suggests potential leadership, but traders should remain cautious near 57,000.

Our trading strategy emphasizes waiting for clear 15-minute candle closes to confirm direction, avoiding the no-trading zone, and adhering to strict risk management. Global cues, particularly lower oil prices and US market trends, support a cautiously optimistic outlook, but vigilance is key.

Disclaimer

The information provided in this article is for educational purposes only and does not constitute financial advice. Trading in the stock market involves risks, and individuals should conduct their own research or consult with a qualified financial advisor before making investment decisions.