Trading Plan: Can Nifty 50 defend short term moving averages, Bank Nifty sustain above Friday’s low?

Nifty Trading Plan for December 29

The Nifty 50 defended the 26,000 level (which somewhat coincides with the midline of the Bollinger Bands and the 10- and 20-day EMAs), closing within the bullish gap of December 22. Momentum indicators suggest some caution. The index may consolidate as long as it trades below 26,250, with immediate support at 26,000–25,950, followed by 25,800 being key support, while a decisive move above this level could push the index toward 26,350–26,500. Meanwhile, if the Bank Nifty fails to defend Friday’s low (58,950), the 58,800–58,700 levels will be key to watch; however, holding above it could drive the banking index toward the 59,100–59,300 zone, experts said.

On December 26, the Nifty 50 slipped 100 points (0.38 percent) to 26,042, while the Bank Nifty declined 172 points (0.3 percent) to 59,011. Bears maintained control over market breadth, with 1,763 shares under pressure against 1,106 shares that gained on the NSE.

Nifty Outlook and Strategy

Rajesh Bhosale, Technical Analyst at Angel One

Overall, it was a subdued week (ended December 26), with traders and investors appearing to be in a holiday mood. On the weekly chart, Nifty formed a neutral Doji candlestick, highlighting indecision at higher levels. As we step into a crucial week that marks both the close of the calendar year and the beginning of a new one, we expect consolidation to persist unless a decisive breakout emerges from the current range.

That said, the broader undertone remains tilted toward the bullish side, as prices continue to trade above key moving averages. Additionally, a fresh bullish crossover in the smoothened RSI near the 50 mark lends support to the positive bias. On the intraday hourly chart as well, prices continue to maintain a higher-top, higher-bottom structure.

In such an environment, traders are advised to avoid getting swayed by short-term noise and instead adopt a buy-on-dips approach while booking profits at higher levels. On the downside, immediate support is placed around 25,900, while 25,700 remains a sacrosanct level for the near-term trend. On the upside, the 26,250–26,350 zone stands out as a key hurdle, beyond which Nifty could see a fresh leg of momentum into uncharted territory.

(Spot)

Key Resistance: 26,250, 26,350

Key Support: 25,900, 25,700

Strategy: Buy Nifty Futures on dips around 26,000, with a stop-loss at 25,800, targeting 26,500–26,700.

Rajesh Palviya, Senior Vice President Research (Head Technical Derivatives) at Axis Securities

The Nifty closed with a modest weekly gain of 76 points. The weekly chart shows that Nifty formed a Doji candlestick, indicating clear indecision among market participants regarding its near-term direction. The index found support near the lower band of a rising channel that has been intact since March 2025.

For bullish sentiment to regain momentum and push toward a retest of the all-time high, a sustained close above 26,200 is essential. On the other hand, a decisive drop below 25,700 could lead to increased downward pressure. A sustained move above 26,200 may attract fresh buying interest, potentially pushing the index toward the 26,350–26,500 range. Conversely, if Nifty breaks down below 25,800, selling pressure could drive it down toward 25,700–25,500.

Additionally, the weekly RSI has flattened, suggesting a lack of clear strength in the index. For the current week, Nifty is expected to trade within a range of 25,500 to 26,500, with a mixed bias.

Key Resistance: 26,100, 26,200

Key Support: 25,950, 25,800

Strategy: Buy Nifty Futures around 25,950, with a stop-loss at 25,800, targeting 26,150–26,200.

Anshul Jain, Head of Research at Lakshmishree Investments

Nifty ended the week with a shooting star on the weekly chart, decisively negating the bullish lower-wick structure formed over the prior two weeks. This reversal candle at higher levels raises concerns for bulls, as it reflects rejection near the upper end of the recent range. The inability to sustain above the highs signals supply dominance and a potential shift in the weekly swing structure.

A follow-through below the current week’s low near 26,000 would confirm bearish intent and open the downside toward the previous weekly swing low around 25,693. On the upside, rebounds toward the midpoint of the weekly candle near 26,150 are likely to attract heavy supply, making such moves vulnerable to fresh short initiation.

Momentum indicators are rolling over from neutral zones, reinforcing the risk of continuation lower. For any meaningful reversal, the index must reclaim and close above 26,200 on a weekly basis to neutralise the bearish setup.

Key Resistance: 26,150, 26,200

Key Support: 26,000, 25,950

Strategy: Sell Nifty Futures on rallies to 26,150, with a stop-loss above 26,200, targeting 26,000.

Bank Nifty - Outlook and Positioning

Rajesh Bhosale, Technical Analyst at Angel One

No significant change was observed in the technical structure of the heavyweight index, as prices remained confined within a sideways trading range despite a positive start to the week. Looking ahead, the outlook remains constructive for the Bank Nifty and aligned with a potential resumption of the primary uptrend once prices decisively break above the immediate resistance at 59,500.

Until then, the ongoing consolidation is likely to persist as long as the strong support zone of 58,800–58,700 continues to hold. However, a breakdown below this zone could trigger further weakness in the near term, opening the door for a possible test of the 50 DEMA in the 58,500–58,400 band.

Participants should closely monitor a breakout beyond the mentioned levels for an uptick in momentum. In terms of levels, the 59,750–59,800 band remains a strong resistance zone, while the 58,500–58,400 region continues to act as a crucial support cluster.

(Spot)

Key Resistance: 59,500, 59,800

Key Support: 58,800, 58,500

Strategy: Buy Bank Nifty Futures on a breakout above around 59,500, with a stop-loss at 58,900, targeting 60,600–60,800.

Rajesh Palviya, Senior Vice President Research (Head Technical Derivatives) at Axis Securities

Bank Nifty closed the week with a loss of 58 points. On the weekly chart, it formed a small bearish candle and remained within the previous week’s high-low range, signaling indecision at current levels.

The index is currently above the earlier resistance zone of 58,600, which has now turned into support, in line with the principle of polarity. However, a decisive close below this level could lead to further downside. From a technical perspective, a sustained move above 59,500 may prompt fresh buying, potentially pushing Bank Nifty toward 59,700–60,200. On the downside, a break below 58,650 could result in selling pressure, dragging the index down toward 58,500–58,000.

Additionally, the weekly RSI has flattened, indicating a lack of strength. For the coming week, Bank Nifty is expected to trade within the 58,000–60,200 range with a mixed bias.

Key Resistance: 59,200, 59,400

Key Support: 58,850, 58,700

Strategy: Sell Bank Nifty Futures around 59,150, with a stop-loss at 59,300, targeting 58,800–58,700.

Anshul Jain, Head of Research at Lakshmishree Investments

Bank Nifty ended the week with an inside bar, reflecting relative strength versus Nifty, but the close near the lower end of the weekly range keeps the undertone cautious. This price compression signals balance, yet the location of the close tilts risk marginally in favour of bears.

Directional clarity will emerge only on a breach of the mother candle extremes placed between 59,533 and 58,712.7. A decisive move and sustained trade below 58,700 would confirm liquidation pressure, exposing the index to a sharper decline toward the next weekly demand pocket. On the upside, rallies into the 59,100–59,300 supply zone are likely to face rejection, as this area coincides with prior breakdown levels and short-term moving average congestion.

Momentum indicators remain subdued, suggesting expansion is imminent. Until a breakout occurs, failed pullbacks and rejection from overhead supply should be viewed as opportunities to initiate fresh shorts within the broader consolidation structure.

Key Resistance: 59,100, 59,300, 59,533

Key Support: 58,700, 58,200

Strategy: Sell Bank Nifty Futures on rallies to the 59,100–59,300 zone, with a stop-loss above 59,533, targeting 58,700.