For the first time in five sessions, the Nifty 50 failed to make an intraday high above the mark of 18,000. The index closed lower for the third straight day after continuing to face pressure at higher levels due to lack of follow-up buying.

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Even as benchmark indices ended flat on Tuesday, BSE-listed companies erased market capitalisation worth nearly Rs 70,000 crore. Reliance Industries continued to lend support to the index while technology names underperformed. The Nifty 50 also closed slightly below its 20-day moving average of 17,838.

Dealing room conversations indicate that 17,800 is now a key support for the Nifty 50 on the downside. In fact, Tuesday's intraday low for the index was exactly 17,800.

Gautam Duggad of Motilal Oswal believes that there is very little for the market to respond to in terms of domestic triggers and that they would mostly look towards global cues for the same.

Vinod Karki of ICICI Securities spoke to CNBC-TV18 on the broader markets and said that Midcaps offer little margin of safety in terms of valuations, but on the flip side, consensus earnings growth of Nifty Smallcap 100 and Nifty Midcap 100 over financial year 2023-2025 may exceed that of the Nifty 50, which in turn can support their valuations.

What do the charts suggest for Dalal Street?

The corrective rise post the budget-day low of 17,356 on the Nifty 50 is most likely complete, according to Jai Bala of cashthechaos.com. He expects the index to remain below levels of 18,135, which is the high made on February 16 and see an accelerative decline. "The market is saying that the next leg of decline has already begun and I will not be surprised if it takes out the budget-day low in the next three sessions," he said.

Nagaraj Shetti of HDFC Securities witnessed the formation of a reasonable negative candle on Nifty 50's daily chart with a minor lower shadow. The formation of overlapping candles and missing of the sharp correction from the previous swing highs indicates the possibility of an upside bounce which may emerge from the lows, according to him. He said that an upside bounce may occur from near-term support levels of 17,700 - 17,750 with immediate resistance at 17,950 - 18,000.

The Nifty 50 bias remains negative as it falls into a descending channel on the daily chart, according to LKP Securities' Rupak De. The Relative Strength Index (RSI) has also entered a bearish crossover. He expects selling pressure on the Nifty 50 to increase in case it breaks below near-term support of 17,750.

Here are key things to know about the market ahead of the trading session on February 22:

SGX Nifty

On Wednesday, Singapore Exchange (SGX) Nifty futures — an early indicator of the Nifty 50 index — declined 54 points or 0.3 percent to 17,791.5, thereby pointing to a negative opening for the market.

Global Markets

US markets resumed trade after Monday's holiday and ended sharply lower. The Dow Jones dropped nearly 700 points, marking its biggest single-day drop since December 15. The S&P 500 ended 2 percent lower, while the Nasdaq declined 2.5 percent.

Investors continue to be concerned over high interest rates and caution prevails ahead of the release of the Federal Reserve's minutes of their latest meeting, which will be released later tonight.

What to expect on Dalal Street

Devarsh Vakil of HDFC Securities sees support for the Nifty 50 index at its previous swing low of 17,719, below which the bearish trend would find momentum. Levels of 18,000 have now become a resistance on the upside, above which the index can move higher.

The Nifty Bank also had a subdued trading session on Monday and also managed to hold on to the crucial support zone of 40,500. Kunal Shah of LKP Securities believes that the if the index does manage to hold on to these levels, it can witness a pullback move towards 41,000 - 41,300. In case it breaks below the support area, it may fall towards the 40,000 mark where significant put writing is seen.

Key Levels To Track

For tomorrow's weekly and monthly options expiry, the 17,800 strike call of the Nifty 50 index added 8.5 lakh shares in Open Interest, while the 18,000 call saw shedding of 20.2 lakh shares.

On the downside, the 17,800 put and 17,700 put saw addition of 17.5 lakh and 6 lakh shares in Open Interest, while shedding was seen in the 18,000 (18.6 lakh shares) and 17,900 put (11.7 lakh shares).

Nifty 50's put-call ratio is now at 0.83 from 0.74 on Monday.

Vodafone Idea has entered the F&O ban period from today's trading session.

FII/DII Activity

Long Unwinding (Decrease In Price and Open Interest)