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However, both the Nifty and Bank Nifty indices continue to trade below their short-term moving averages on daily charts. The next few days could lead to a self-fulfilling prophecy, where the collective expectation of a continued downtrend, can push the market further down.

From a derivative perspective, option writers are maintaining significant open interest at the 25,100, 25,200, and 25,300 strike levels, which may serve as strong resistance for the index going forward. These levels, heavily laden with the anticipation of a ceiling, might become psychological barriers, triggering further selling activity as traders, influenced by loss aversion, rush to secure profits or minimize losses. Additionally, the banking index faces hurdles in the 51,700-51,900 range, where bearish sentiments, fueled by the lingering fear and uncertainty that often pervades markets, could resurface.