Nifty Trade Setup for October 8: Nifty Falls 0.76% After RBI Rate Hike, Can Bears Push It Below 22,500?

The Nifty 50 snapped its two-session recovery on October 7, closing at 22,603.05, down 173.05 points or 0.76%. The index opened at 22,690.45 and moved between 22,546.30 and 22,717.65 before ending near the day's lower half. The decline came after the RBI raised the repo rate by 25 basis points to 5.50% and shifted its stance to calibrated tightening, adding pressure on equities.

Market Breadth Turns Bearish as Selling Broadens

Market breadth turned sharply negative, with only 9 stocks advancing and 41 declining out of the Nifty 50 constituents. Despite the broad-based weakness, Nifty50 PSU Bank and Nifty50 Media were among the sectors showing relative strength. The weak advance-decline ratio indicates that the recovery seen over the previous two sessions lacked follow-through and selling pressure returned across most major segments.

Nifty Technical Setup: Index Faces Resistance Near 22,770–23,075

On the daily chart, Nifty 50 formed a weak session after failing to sustain above the 22,770–22,800 zone. The index is now trading below its short-term EMA near 22,771, while the broader EMA structure remains firmly bearish. The 23,076.90 level continues to act as a major resistance. On the downside, 22,221.85 remains the key positional support, while 22,500 could provide immediate psychological support.
 

On the hourly chart, Nifty is trading around 22,603, below the short-term EMA cluster near 22,625–22,714, indicating that bulls have lost some momentum. The 15-minute chart also shows the index hovering around its short-term EMA zone near 22,609–22,639. A sustained move above 22,640–22,715 could improve the short-term setup, while failure to reclaim this zone may keep selling pressure intact.

Momentum Indicators Show Weakness but Not Extreme Oversold Conditions

The daily RSI stands at 33.13, showing that momentum remains weak and is approaching oversold territory, but it has not yet reached extreme levels. The hourly RSI is at 47.69, while the 15-minute RSI is at 46.02, suggesting that intraday momentum has turned neutral-to-bearish after the recent recovery. A fresh decline below the day's low could put further pressure on the short-term setup.

Key Levels to Track for Nifty

For the next session, 22,500–22,546 will be the immediate support zone, followed by the major support at 22,221.85. On the upside, 22,625–22,715 is the first resistance zone, followed by 22,770–22,800. A sustained move above 22,800 could revive the recovery towards 23,000–23,076.90. However, failure to reclaim 22,715–22,800 could keep the index under pressure, with 22,500 and 22,221.85 becoming the levels to watch.