Monday Watchlist: Nifty volatility spikes — IT, Pharma & Realty among key sectors to watch

This rise has pushed VIX past October 8th’s levels, when Nifty had tested 22179.9, the lowest since April. IT Index resisting bearish trend IT appears to be the only index, among key Nifty sectoral indices, that has resisted the bearish onslaught. While it is 4% above the 200 day SMA, Nifty has sunk 6% below its 200-day SMA. No other key Nifty sectoral index is above their 200-day SMA, except for Pharma.

While the 200-day SMA points to the long term trend, the comparison with respect to 20 day SMA gives a better picture of how strong the recent bearishness has been. While Nifty is just 0.5% below its 20 day SMA, small cap 100 index is 7.25% below this key short term average, indicating growing risk aversion among traders, while a handful of heavyweight stocks continue to lend support to the Nifty.

7% CAGR in 5 Years Meanwhile, FIIs continued to pile on to index future shorts, but by only 1.3% on a week on week basis. While index future longs were cut by 7.45% over the week, FIIs adding 6.5% index future longs on Friday. point to tactical positioning, potentially anticipating pull back after sustained downtrend. Realty Index remains vulnerable as downtrend trend persists The Nifty Realty Index continues to look technically fragile.

Since 2025, it has been moving within a well-defined descending channel and forming a consistent sequence of lower highs and lower lows. The latest setback began after the index failed to sustain a move above the channel resistance near 935 in August. That rejection brought sellers back into control, and the index has remained under pressure since then. Adding to the concern, it has closed below the weekly Supertrend, reinforcing the view that the broader trend is still weak.

Momentum indicators also lean in favour of the bears. The daily MACD has slipped below its signal line, pointing to fading momentum, while the RSI is moving closer to the oversold region. This may lead to occasional relief rallies as short positions are covered and bargain hunters step in. Unless the price trend shows a clear and sustained improvement, any recovery is likely to lose momentum, with higher levels potentially prompting renewed selling pressure.

The immediate level to watch is 755. If the index breaks below this support and stays there, the correction could deepen towards 710. On the upside, a recovery above the 825–850 zone is needed to signal a meaningful improvement in the near-term structure. Until that happens, the outlook remains mildly bearish. Traders may therefore prefer to stay cautious, as rallies are likely to encounter resistance and volatility could remain elevated around key support levels.

9% ROCE: An under-the-radar smallcap eyes the data centre boom Pharma Index nears key support, reversal potential builds The Nifty Pharma Index has remained in a profit-booking phase since slipping below its rising wedge pattern in September. The pullback has now brought the index close to an important support cluster around 24,950. This area combines the 38.2% Fibonacci retracement, a horizontal support level and the weekly Supertrend, making it a technically significant zone where buyers may begin to show greater interest.

The recent decline has given back a meaningful part of the previous rally, but the index is now approaching a level that could help restore some balance. If prices stabilize around this support cluster, bargain hunting may emerge and pave the way for a technical recovery. In that scenario, the first upside hurdle would be the 25,900–26,150 resistance zone. A sustained move beyond this resistance range would lend greater credibility to the rebound and signal an improvement in the index’s short-term technical outlook.

On the downside, 24,400 remains the key level to protect. As long as the index holds above it, the possibility of a reversal remains alive, although some volatility around the support zone should be expected. A decisive break below 24,400 would change the picture, weaken the current setup and raise the risk of a deeper correction. The index is approaching a key inflection point, but its next directional move will need confirmation from price action before a firmer outlook can be established.

About author The author is Anand James, Chief Market Strategist at Geojit Investments. Disclaimer The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein. The content of the articles and the interpretation of data are solely the personal views of the contributors/ writers Investors must make their own investment decisions based on their specific objectives, resources and only after consulting such independent advisors as may be necessary.