Trade Setup for September 16: Experts suggest buying Nifty on dips amid likely profit booking at higher levels

Indian equities paused on Monday (September 15) as the benchmark Nifty50 index snapped its eight-day winning streak, closing below the 25,100 level.

In the absence of any major triggers, the index began the week on a flat note and traded in a narrow, lackluster range through the session. After opening on a flat-to-positive note, Nifty was unable to hold on to early gains and slipped into mild weakness.

The day's trade was largely marked by consolidation, with the index moving within the previous session's range before finally ending just above the 25,050 mark.

Leading the charge within the Nifty pack were Jio Finance, Bajaj Finance, and Eternal. On the flip side, it proved to be a tough session for names like Cipla, M&M, and Asian Paints, which ended as the major losers.

Despite the benchmark's minor dip, the broader market indices outperformed. The Nifty Midcap 100 Index gained 0.44%, and the Nifty Smallcap 100 Index surged 0.76%.

On the macroeconomic front, India's retail inflation inched up to 2.07% in August 2025, broadly in line with estimates, after easing for nine straight months.

Investors will also keep an eye on the US retail sales data due on Tuesday.

Overall, Siddhartha Khemka of Motilal Oswal expects the market to remain in consolidation mode, tracking cues from the US Federal Reserve's policy outcome and progress in India-US trade talks. The Fed's two-day policy meeting begins on September 16, with global markets widely anticipating a 25-basis-point rate cut amid weak employment data and growing pressure from the US administration.

Foreign investors were net sellers in the cash market on Monday, while domestic investors were net buyers.



What do the Nifty 50 charts indicate?

A phase of consolidation may be underway for the Nifty before the next leg higher, according to Nilesh Jain of Centrum Broking. He said that the broader trend remains positive as long as the index holds above the 24,900 mark, which coincides with the 50-day moving average (DMA).

A decisive breakout above 25,150 could trigger short covering and spark a rally toward the 25,300 zone, though some profit booking at higher levels is expected. Jain suggests a buy-on-dips strategy in the current setup.

Nagaraj Shetti of HDFC Securities said the near-term uptrend in Nifty remains intact, with the ongoing consolidation or mild weakness presenting a buying opportunity.

He expects the index to eventually break past the hurdle at 25,150, which could open the next upside target of 25,400-25,500. Immediate support, he added, is placed at 24,900.

Rajesh Bhosale of Angel One mentioned that traders are keeping positions light ahead of the US Fed's policy meeting. He pointed out that momentum is likely to return only once Nifty sustains above the 25,150 mark. Technically, the index recently defended its swing low of 24,340, forming a higher bottom, a move that could attract fresh buying interest once 25,150 is crossed.

LKP Securities' Rupak De said that Nifty formed a small reversal candle on the daily chart, reflecting investor caution ahead of the Fed rate decision. He said the previous swing high at 25,150 continues to act as resistance. Until the index moves above this level, the trend may stay uncertain. On the downside, support is seen at 24,800, and a breach below this could trigger further weakness.

Adding to the bullish undertone, Nandish Shah of HDFC Securities pointed out that Nifty is trading above its 20, 50, 100, and 200 DEMA levels, indicating strength across all time frames. The higher-top, higher-bottom formation on the weekly line chart, he said, confirms a bullish reversal on the positional setup.

Nifty Bank view

The Nifty Bank index exhibited a muted performance in today's session, trading within a narrow range of just 211 points, its tightest intraday movement since September 2024.

This subdued price action reflects a phase of low volatility and cautious sentiment among market participants, said Sudeep Shah of SBI Securities.

"Going ahead, the 50-day EMA zone of 55,100-55,200 will act as a crucial hurdle for the index. Any sustainable move above the level of 55,200 will lead to a sharp upside rally upto the level of 55,600, followed by 56,000 in the short term. While, on the downside, the 20-day EMA zone of 54,700-54,600 will act as crucial support for the index," Shah added.