Trading Plan: Can Nifty 50 reclaim 26,000, Bank Nifty move beyond 59,500?

NIfty Trading Plan for December 12

The Nifty 50 continued to trade between short-term moving averages (25,950–26,000) and the medium-term moving average (25,700) for the third consecutive session, though there was a rebound on Thursday after a three-day fall. If the index decisively breaks out and sustains above the upper range, a rally toward 26,100–26,200 can’t be ruled out, while 25,700 can act as immediate support. Meanwhile, the Bank Nifty needs to take out the 59,400–59,500 range for an upward journey toward 59,800–60,000 levels; until then, 58,800 can be immediate support to watch, experts said.

On December 11, the Nifty 50 bounced back 141 points (0.55 percent) to 25,899, while the Bank Nifty rallied 249 points (0.42 percent) to 59,210. The market breadth was in favour of the bulls, with 1,746 rising shares compared to 1,081 declining shares on the NSE.

Nifty remains locked in a tightening consolidation, but the price squeeze between the 20-DEMA and 50-DMA hints at an impending sharp move. Despite steady support at the 50-DMA, the index’s failure to clear its previous day’s high for three sessions keeps the lower-high structure intact, with 26,000–26,100 acting as a strong supply zone.

Derivatives positioning reinforces this barrier, as aggressive Call writing caps upside while firm Put interest at 25,700 protects the downside. The index now sits at an inflection point — a breakout above 26,000 could ignite momentum toward 26,350, while a slip below 25,700 may swiftly drag it to 25,500.

Key Resistance: 26,000, 26,150, 26,250

Key Support: 25,800, 25,650, 25,500

Strategy: Traders may consider the Bull Put Spread strategy for the December 16 expiry by selling one lot of 26,150 PE at Rs 244 and buying one lot of 25,900 PE at Rs 86. This setup is designed to capitalize on potential moderate bullish momentum.

Stop-Loss: Hold the strategy until expiry, with the maximum Mark-to-Market (MTM) loss capped at Rs 6,841.

Target: Hold the strategy until expiry to achieve a maximum profit of Rs 11,906, or consider booking profits once the MTM gains exceed Rs 7,000.

Nifty has given a breakdown from a bearish rising wedge on the daily chart near all-time highs, reinforced by clear bearish divergence on momentum indicators. The previous week produced a bearish belt-hold/hanging-man candle exactly at the peak of 26,325.8 (open = high). Despite the breakdown, the index is still defending the critical 25,680–25,700 zone. A decisive break below this level would shift short-term control to bears and likely accelerate selling pressure.

The medium- to long-term structure continues to show higher highs and higher lows, but some weakness and a drop in momentum are seen on the short-term timeframe. Until a clear breach occurs on either side, aggressive directional bets carry high risk.

Key Resistance: 26,000, 26,200, 26,330

Key Support: 25,680, 25,400, 25,300

Strategy: Short Nifty Futures only on a close below 25,680, with a stop-loss of 25,900, targeting 25,400 and 25,300, or go long on Nifty Futures on a sustained move above 26,200, and add above 26,330 for higher targets.

Currently, the Nifty 50 is trading within the 25,700–25,950 range, signalling a consolidation phase ahead of a potential decisive move. This tight band suggests a temporary equilibrium between buyers and sellers as the market awaits fresh triggers.

On the upside, immediate resistance is positioned at 26,000–26,100. A sustained breakout above this zone could open the path toward 26,300, reinforcing a continuation of the broader uptrend. Support remains firm at 25,800 and 25,700. As long as Nifty holds above 25,700 on a closing basis, a buy-on-dips strategy is advisable, with strict adherence to stop-loss levels until a clear breakout emerges.

Key Resistance: 26,000, 26,300

Key Support: 25,800, 25,700

Strategy: Buy Nifty Futures on dips near the 26,000 level for a target of 26,250–26,300, with a stop-loss of 25,700 on a closing basis.

Nifty Bank remains stuck in a choppy zone but continues to draw steady support from the 58,500–58,600 Fibonacci band, a region that has repeatedly absorbed selling pressure. Despite this resilience, the index has failed to clear its previous day’s high for four sessions, reinforcing a lower-high structure and persistent supply near 59,500–59,700.

Derivatives positioning echoes this restraint, with dense Call writing capping upside while Puts cluster around 59,000. Until 58,600 holds, buying on dips remains viable, though momentum stays muted. A sustained break above 59,500 could revive strength, while a slip below 58,600 may trigger accelerated downside.

Key Resistance: 59,500, 59,700, 60,000

Key Support: 59,000, 58,800, 58,700

Strategy: Traders may look to go long on Nifty Bank December Futures in the 59,650–59,700 zone, with a stop-loss placed below 59,350. Profit booking can be considered around 60,150–60,220.

Bank Nifty is showing clear signs of exhaustion near all-time highs, with bearish divergence on daily momentum and a hanging-man candle from the previous week formed right at the peak. Since early October, the index had never closed below the 20-day EMA — until December 10, when it recorded its first close beneath this key average.

In the latest session, price reclaimed the 20-day EMA but failed to surpass the December 10 high, underlining indecision. Traders should exercise caution and avoid aggressive directional bets until a clear breach occurs on either side. The 58,500–58,650 zone remains the critical make-or-break support. A confirmed close below this band would indicate genuine weakness and open the door to a sharper correction. Until then, expect range-bound action between roughly 58,500 and 59,800. The medium-term trend stays bullish, but short-term charts reflect visible weakness.

Key Resistance: 59,500, 59,800, 60,100

Key Support: 58,800, 58,750, 58,500

Strategy: Short Bank Nifty Futures below 58,750, add more shorts below 58,500, with a stop-loss of 59,000, targeting 58,000 and 57,700. Consider longs only on a decisive breakout and hold above 59,800.

At present, the Bank Nifty is trading within the 58,800–59,450 band, indicating a consolidation phase as market participants await a clear directional catalyst. This range-bound movement underscores the ongoing balance between buyers and sellers.

Immediate resistance is positioned at 59,450, and a sustained breakout above this level could pave the way for an advance toward 59,700–60,000. A move beyond this zone may further strengthen the upward trajectory. On the downside, support levels are placed at 59,000 and 58,750. As long as the index maintains a close above 59,000, a buy-on-dips approach remains favorable, with traders advised to adhere to strict stop-loss parameters until a definitive breakout or reversal pattern develops.

Key Resistance: 59,450, 60,000

Key Support: 59,000, 58,750

Strategy: Buy Bank Nifty Futures on dips near 59,200, with a stop-loss of 58,900 on a closing basis, for a target of 60,000–60,100.