The Nifty 50 and Bank Nifty closed flat after a rangebound and volatile session on December 26. The Nifty 50 has been in the range of 23,650–23,850 for three days in a row. A break below the lower band of the range could drive it down towards 23,500 (the previous week's low), but decisively surpassing the upper band could take it towards 24,000 in the immediate term, experts said. The Bank Nifty faces a hurdle at 51,750, and breaking above this level could pull the index towards the 52,000–52,100 zone. However, falling below 51,000 could push the index back to last week’s low.

On Thursday, December 26, the Nifty 50 rose by 23 points to 23,750, while the Bank Nifty fell by 62 points to 51,171. The market breadth was weak, with 1,494 shares declining against 1,010 shares advancing on the NSE.

Nifty Outlook and Strategy

Hardik Matalia, Derivative Analyst at Choice Broking

On the daily chart, the Nifty index formed a Doji candlestick pattern with a small bearish body and long upper and lower wicks, indicating indecision among buyers and sellers. It was largely a sideways session throughout the day. On the downside, the 23,650 level serves as critical support. A breach of this level could push the index further down toward the 23,500–23,200 range. On the upside, 24,050 acts as a key resistance level, with the next major hurdle at 24,200. A sustained close above these levels is crucial to reversing the prevailing bearish trend. In this volatile environment, traders are advised to exercise caution, implement strict stop-loss strategies, and avoid carrying long positions overnight to mitigate risks effectively.

Key Resistance: 24,050, 24,200

Key Support: 23,650, 23,500

Strategy: Sell Nifty Futures on a rise near the 24,050 level, with a stop-loss at 24,200, targeting the 23,200 level.

Chandan Taparia, Senior Vice President | Head – Technical Research and Derivatives at Motilal Oswal Financial Services

This week, Nifty traded in a narrow range of 300 points, showing little movement compared to last week’s sharp fall. The index consistently faced resistance near the 23,870–23,900 zone while finding support around 23,600.

The tug-of-war between bulls and bears resulted in multiple Doji candles and inside bar formations on the daily chart, which indicate indecision. Even on the weekly chart, Nifty has formed a Doji candle. The index continues to hover near its 200-day EMA while trading below short-term moving averages. Now, it has to hold above the 23,700 zone for a bounce towards the 23,850 and 24,000 zones, whereas supports are seen at 23,600 and 23,500.

Key Resistance: 23,850, 24,000

Key Support: 23,600, 23,500

Strategy: Buy Nifty Futures on a decline with support at 23,500, targeting the 23,850 and 24,000 zones.

Virat Jagad, Technical Research Analyst at Bonanza

The RSI (Relative Strength Index) hovers near the oversold region, highlighting weak momentum and reinforcing a flat-to-negative bias. This technical setup suggests a lack of clear direction, with sideways movement likely to persist, keeping the Nifty 50 under pressure in the near term unless a decisive breakout occurs.

Key Resistance: 23,800, 24,000

Key Support: 23,700, 23,400

Strategy: Sell Nifty Futures below 23,700 with a stop-loss at 23,850, targeting 23,400.

Bank Nifty - Outlook and Positioning

Hardik Matalia, Derivative Analyst at Choice Broking

On the daily chart, the Bank Nifty formed a bearish-bodied candle with a long upper wick and a slightly lower wick, reflecting indecision between buyers and sellers. If the index falls below the 51,000 level, bearish sentiment may persist, potentially pushing the index to lower levels. Additionally, the index is trading below its short-term (20-day) and medium-term (50-day) EMAs, signaling the need for a cautious approach.

Key support levels are at 51,000 and 50,700. A breakdown below these levels could lead to a further decline toward the 50,300 mark. On the upside, 51,500 serves as immediate resistance, followed by 52,000. A sustained breakout above 52,000 is critical to reversing the prevailing bearish trend. Traders are advised to closely monitor these key levels, as price action around them will be pivotal in determining the index's next directional move.

Key Resistance: 51,500, 52,000

Key Support: 51,000, 50,700

Strategy: Sell Bank Nifty Futures on a rise near the 51,800 level, with a stop-loss at 52,000, targeting the 51,000–50,300 levels.

Chandan Taparia, Senior Vice President | Head – Technical Research and Derivatives at Motilal Oswal Financial Services

The Bank Nifty index is currently stuck between its 50 DEMA and 200 DEMA, with stock-specific action being observed. As long as it holds below the 51,500 zone, some weakness could be seen, potentially pushing it towards 50,750 and then 50,500 levels. On the upside, resistance is seen at the 51,500 and 51,750 zones.

Key Resistance: 51,500, 51,750

Key Support: 50,750, 50,500

Strategy: Sell Bank Nifty Futures on a bounce with resistance at 51,750, targeting downside levels of 50,750 and 50,500.

Virat Jagad, Technical Research Analyst at Bonanza

The Bank Nifty index has been consolidating over the past five sessions, oscillating within a defined range of 50,750 to 51,750. The index is currently trading near its trendline support, requiring a bounce from this level to sustain any potential upside. On the daily chart, a small negative candle with upper and lower shadows reflects market volatility and indecision among traders. The RSI remains below the midline, indicating subdued momentum and supporting the sideways trend. A decisive breakout above the 51,750 level is essential for Bank Nifty to resume its upward trajectory.

Key Resistance: 51,750, 52,500

Key Support: 50,750, 50,000

Strategy: Buy Bank Nifty Futures near 51,000 with a stop-loss at 50,700, targeting 51,600.