Trading Plan: Will Nifty 50, Bank Nifty maintain upward journey amid consolidation?

Nifty Trading Plan for January 2

• Momentum suggests that the Bank Nifty is also likely to inch higher toward the 60,000–60,100 levels once it decisively clears 59,800 hurdle, while 59,200–59,000 is expected to be the immediate support.

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The momentum and technical indicators remain supportive for bulls; hence, the index may gradually climb toward the 26,350–26,400 levels, but only after it convincingly surpasses and holds the 26,200 zone (which coincides with the falling resistance trendline). Until then, consolidation may continue with support at the 26,050–26,000 levels. Meanwhile, momentum suggests that the Bank Nifty is also likely to inch higher toward the 60,000–60,100 levels once it decisively clears 59,800 hurdle, while 59,200–59,000 is expected to be the immediate support, experts said.

On January 1, the Nifty 50 rose 17 points to 26,147, while the Bank Nifty climbed 130 points to 59,712, with positive market breadth. A total of 1,486 shares advanced against 1,386 declining shares on the NSE.

Nifty Outlook and Strategy

Jay Mehta, Technical Research at JM Financial Services

Nifty has been range-bound within a 630-point band from 25,700 to 26,330 over the past 36 trading sessions. Buyers have defended the lower end, while sellers have aggressively dominated the upper boundary, leading to three bearish weekly candlestick patterns at the highs over the past 36 sessions: two Hanging Man and one Gravestone Doji.

For the next strong upward rally, the price must sustain above 26,330; otherwise, further consolidation is likely to continue. The key positive takeaway is that the index is trading above all key EMAs, with the 50-day EMA offering solid support.

Key Resistance: 26,225, 26,330, 26,550

Key Support: 25,930, 25,800, 25,700

Strategy: Traders can engage in range trading until 25,700 or 26,330 is decisively breached on either side. Momentum traders should await a breakout for directional plays.

Om Mehra, Technical Research Analyst at Samco Securities

The Nifty 50 formed a small-bodied candle on the daily chart, reflecting indecision at higher levels. Nifty is holding above its short-term average, which continues to act as immediate support on declines. As long as the index sustains above 26,050, the broader bias remains constructive, although a decisive breakout is still awaited.

The daily RSI is placed near 56, while the MACD has turned marginally positive, indicating stabilisation rather than strong momentum.

The PCR around 1.1 indicates balanced to mildly bullish positioning. Call open interest remains concentrated around the 26,200–26,300 strikes, indicating strong overhead resistance in this zone. On the Put side, notable open interest build-up is visible near the 26,000 strike, reflecting support and suggesting that market participants are comfortable defending this level. The maximum pain level is placed near 26,150, reinforcing the ongoing range-bound setup in the near term.

Overall, Nifty continues to trade in a range-bound consolidation phase with a slight bullish bias, as support gradually shifts higher. A sustained close above 26,200 is required to re-ignite upside momentum.

Key Resistance: 26,200, 26,250, 26,300

Key Support: 26,050, 26,000, 25,950

Strategy: Bull Call Spread for the January 6 expiry by buying one lot of 26,000 CE at Rs 192.20 and selling one lot of 26,300 CE at Rs 25.25. This setup is designed to benefit from a gradual upside or sustained trade above the 26,000 zone, while limiting downside risk in case Nifty remains range-bound.

Stop-Loss: Hold the strategy with a maximum MTM loss capped near Rs 5,000.

Target: Hold the strategy until expiry for a maximum profit potential of Rs 8,600, or consider booking profits if MTM gains approach Rs 5,500–6,000.

Amruta Shinde, Derivative Research Analyst at Choice Broking

Thursday's price action indicates consolidation near record highs, suggesting that while bulls remain in control, fresh triggers are required for a strong follow-through move. The index continues to hover close to the 25,900–26,100 zone, reinforcing the presence of supply at higher levels while also highlighting strong underlying demand.

Going forward, immediate resistance is placed in the 26,200–26,250 range, and a sustained move above this zone could open the door for an upside extension toward 26,400–26,600 in the near term. On the downside, immediate support is seen at 26,000, followed by 25,900, which is expected to act as a strong demand zone. As long as the index holds above 25,900–26,000, the broader trend remains positive, and a “buy-on-dips” strategy continues to be advisable.

Key Resistance: 26,400, 26,600

Key Support: 26,100, 25,900

Strategy: Buy Nifty futures on dips near the 26,200 levels for a target of 26,450–26,600 levels, with a stop-loss of 26,050 on a closing basis.

Bank Nifty - Outlook and Positioning

Jay Mehta, Technical Research at JM Financial Services

Bank Nifty is trading in a 58,600–59,900 range but demonstrates superior relative strength compared to Nifty. Recent sessions have seen strong volume participation, enhancing the bullish setup. Price has built a firm base around the 20-day EMA and remains above all key EMAs.

RSI has repeatedly found support at 50 during consolidation and now trades at 62. The short-term structure favours a high probability of retesting all-time highs or higher in the coming sessions, provided 59,100 holds. On the 75-minute chart, it is forming a pennant pattern.

Key Resistance: 60,110, 60,300, 60,550

Key Support: 59,500, 59,250, 59,100

Strategy: Buy Bank Nifty futures with a stop-loss at 59,100, targeting 60,110, 60,300, and 60,550.

Om Mehra, Technical Research Analyst at Samco Securities

The daily chart continues to reflect a bullish continuation after a minor pullback from its all-time high of 60,114.30. The recent pullback suggests consolidation within an upward bias rather than any signs of trend exhaustion in Bank Nifty.

On the daily timeframe, the index is holding comfortably above all key moving averages. The 10 EMA and 20 EMA continue to act as reliable medium-term support. On the hourly chart, the index traded steadily, with no significant signs of distribution.

The daily RSI has moved back above 60, signalling strengthening momentum, while the MACD has registered a bullish crossover, confirming the continuation of the prevailing uptrend.

The PCR is placed near 1.16, indicating a bullish positioning bias. Put open interest is concentrated around the 59,500 strike, highlighting a strong support base, while Call open interest is visible near the 60,000 level, marking it as an immediate resistance zone. The maximum pain level is placed near 59,500.

Bank Nifty continues to trade firmly, with the trend remaining bullish. Pullbacks toward support zones are likely to attract accumulation interest, while a sustained move above 59,850 could open the path toward the 60,000 mark.

Key Resistance: 59,850, 60,000, 60,150

Key Support: 59,500, 59,450, 59,400

Strategy: Traders can apply a Bull Call Spread strategy for the January 27 expiry by buying one lot of 59,500 CE at Rs 863 and selling one lot of 60,100 CE at Rs 525.90. This strategy is positioned to benefit from a continued upward trend.

Stop-Loss: Maintain the strategy with a maximum MTM loss capped near Rs 5,000.

Target: Hold the strategy until expiry for a maximum profit potential of Rs 7,800, or consider booking profits if MTM gains approach Rs 5,500–6,000.

Amruta Shinde, Derivative Research Analyst at Choice Broking

On the daily chart, Bank Nifty formed a small-bodied candle near the highs, highlighting healthy consolidation after the recent rally. This price structure suggests that the prevailing uptrend remains intact, with bulls maintaining control despite the absence of strong momentum buying. The index continues to trade comfortably above its short-term moving averages, reinforcing a positive near-term technical structure.

On the 1-hour timeframe, Bank Nifty displayed a sideways-to-mild bullish structure, with higher lows intact and intraday declines being swiftly absorbed. This behaviour points toward ongoing accumulation and indicates that market participants are positioning for a potential continuation move rather than exiting long positions.

Going forward, immediate resistance is placed in the 60,000–60,200 zone, and a sustained breakout above this range could open the door for an upside move toward 60,350 and higher in the near term. On the downside, key support is seen in the 59,300–59,500 zone, followed by a stronger base near 59,000, which is expected to act as a major demand area. As long as the index holds above 59,000, the broader trend remains bullish, and a “buy-on-dips” strategy continues to be advisable.

Key Resistance: 60,000, 60,300

Key Support: 59,300, 59,500

Strategy: Buy Bank Nifty futures on dips near the 59,700 levels for a target of 60,000–60,350 levels, with a stop-loss of 59,400 on a closing basis.