How to trade Nifty Auto, IT, Pharma as Trump threatens up to 25% tariffs

Technical chart suggests that the Nifty Auto, IT and Pharma indices can potentially fall up to 22% from present levels if these key support levels are broken.

The Nifty Auto, IT and Pharma indices started Wednesday's trading session with losses over 2 per cent after the US President Donald Trump threatened up to 25 per cent tariffs on automobile, semiconductor and pharmaceutical imports. The Nifty Pharma, in particular, was down more than 2 per cent; Nifty Auto, and IT index declined around 0.5 per cent each.  According to a Reuters report, Donald Trump intends to impose auto tariffs "in the neighbourhood of 25 per cent" and similar duties on semiconductors and pharmaceutical imports. Trump said levies on automobiles would come as soon as April 2.  READ: Share Market LIVE Updates  Asked about similar levies on pharmaceutical drugs and semiconductor chips, the president said: "It'll be 25 per cent and higher, and it'll go very substantially higher over a course of a year." Trump said he wanted to give companies "time to come in" before announcing new import taxes. READ MORE  Trump previously announced 25 per cent tariffs on steel and aluminium that are set to take effect in March; however, the latest import duty threat would widen tariff war, as it covers wider sectors.  Back to the markets, since the start of the year 2025, the Nifty Pharma index has slumped 12 per cent, the Nifty Auto index has slipped nearly 5 per cent, and the Nifty IT has shed 1.6 per cent.  In comparison, the National Stock Exchange (NSE) benchmark, the Nifty 50 index and the Bombay Stock Exchange (BSE) benchmark, the Sensex were down around 3 per cent each.    Against this background, here are the key levels to watch out on the Nifty Auto, Nifty IT and Nifty Pharma indices, as they risk a potential 22 per cent downside in a worst case scenario.  Nifty Auto  Last Close: 21,819  Downside Risk: 15.2%  Support: 21,400; 21,300; 20,300  Resistance: 22,680; 23,100; 23,400  The Nifty Auto index is seen trading with a negative bias for the last three weeks. Chart shows presence of near support for the index at 21,400 and 21,300 levels; break of the same can trigger a fall towards 20,300 levels. The 20,300 level is the key long-term support for the index, as long as it maintains above the same, the index could consolidate and attempt to resume its uptrend. CLICK HERE FOR THE CHART  On the other hand, a monthly close below 20,300 shall dismantle the prevailing long-term positive trend since November 2020. As such, the index could then slide towards 18,500 levels.  Despite the oversold nature, upside for the index seems capped around 23,400 levels; with near resistance seen at 22,680 and 23,100 levels.    Nifty IT Last Close: 41,464  Downside Risk: 10.8%  Support: 40,500; 39,975  Resistance: 42,825  The Nifty IT Index has been an outperformer in the recent downtrend, and is seen still holding above its 200-DMA (Daily Moving Average), unlike the benchmark and other key sectoral indices. Chart suggests that the near-term bias is likely to remain positive as long as the index holds above 40,500 levels; below which strong support for the index exists at 39,975. CLICK HERE FOR THE CHART  Break and sustained trade below the above mentioned support levels, can weaken the chart structure and as such open the doors for a likely fall towards 37,000-mark. Interim support can be anticipated around 38,750 and 37,900 levels.  For the positive bias to strengthen and the uptrend to resume, the Nifty IT index needs to cross and sustain above the 42,825 levels.  Nifty Pharma Last Close: 20,969  Downside Risk: 22.3%  Support: 19,300; 19,100; 18,000; 17,735; 16,820  Resistance: 21,250; 22,280  The Nifty Pharma index seems on course to test its long-term support in the range of 19,300 - 19,100 levels. The near-term bias is likely to remain negative as long as the index remains below 21,250; above which the key hurdle stands at 22,280 levels. CLICK HERE FOR THE CHART  In case the Nifty Pharma index breaks below the 19,300 - 19,100 support range, it shall indicate an end to the 5-year bull run, and as such imply a tepid trend going ahead. In the worst case scenario, the Nifty Pharma index could slide to 16,300 levels; with intermediate support expected around 18,000, 17,735 and 16,820 levels.