Only for a dramatic and almost comedic impact would I use this.

Very Shakespearian! Nay - old-fashioned and grandiose!

Yes it's very dramatic, i don't think you normally hear someone say that. If you wanted to change something that you already said, then you might say "well, actually..."

Nay is an old word for no. It is still used in legal proceedings and politics which are heavily based on tradition. I think it might also have colloquial use in Scotland, but the way they pronounce it can sound like knee. The opposite of nay is aye (pronounced I), and a vote in parliament is divided into ayes and nays. The guy in the picture is a lawyer, so nay is a part of his legal jargon, but I agree with the others who say no would be perfectly good in any situation. English doesn't have a specific word like the German doch for contradicting. ...and just for fun, neigh (pronounced nay) is the sound a horse makes. 🐴

The majority of English speakers would use "no" in place of "nay" there.