Nifty is 'teetering' at 22,700—why rising fear is leaving traders with nowhere to hide.

The Nifty 50 extended its losses for a second consecutive session, falling more than a third of a percent on October 21. The index closed well below its short-term moving average, the 20-day exponential moving average (EMA), and continued to trade below its medium- and long-term moving averages (50-day, 100-day and 200-day EMAs), all of which were sloping downward. This signalled broader weakness in the market. Meanwhile, the India VIX climbed to around a four-and-a-half-month high, indicating rising risk and discomfort among bulls.

Adding to the concerns, Brent crude oil futures traded at around $110 a barrel, raising the risk of a higher import bill and inflationary pressures for net oil-importing countries such as India. Market breadth remained firmly in favour of the bears, with broader market indices witnessing sharp declines. The Nifty Midcap 100 and Smallcap 100 indices fell 1.58 percent and 2.37 percent, respectively.