Last week, 26,108 was highlighted as the first resistance level, with 25,977 marked as the initial support. The market is currently witnessing a swing within a broad 25,500–26,300 trading range. Throughout the week, bears did not allow Nifty to move above 26,108, and the index gradually drifted lower to 25,726. However, toward the end of the week, a recovery emerged, enabling Nifty to post a fairly decent close at 25,966.
Key changes observed toward the week’s end included the rupee, which was heading toward a breakdown, showing mild strength and managing a better close. Foreign investors marginally reduced selling and began selective buying, while interest in midcap stocks started to increase. With only seven trading sessions left for the calendar year to conclude, let us examine what to expect in the coming days.
Nifty’s first resistance zone is seen in the 26,023–26,058 range. If this zone is decisively crossed, the next resistance will be encountered near 26,203. A further breakout beyond this level would bring the final resistance band of 26,270–26,320 into focus, which bears are likely to defend aggressively. On the downside, a close below 25,899 would point toward bears maintaining control. The next crucial support would then be 25,770. If this level is breached, Nifty could be pushed toward 25,670–25,550–25,318. These zones have relatively strong support, and a proper test of strength can be expected in this region.
The Dow Jones lost the key 48,300 level last week and closed at 47,951. In the coming days, 47,856 will be the immediate support to watch. A break below this level can be interpreted as a sign of strengthening bearish momentum. Gold closed last week at 4,369, holding above the key “Lakshman Rekha” level of 4,345. If this level is sustained, the next move could extend toward 4,424–4,540–4,675. Holding above 4,345 until the end of the month could open the door for the next major bullish rally in gold, the possibilities of which can be examined later. The rupee, meanwhile, closed at 89.72, below the previously indicated key level of 89.90, with the probability favouring a continuation toward 89.20.
Turning back to equities, it would be prudent to evaluate Nifty’s key “pillar sectors” — Bank Nifty, IT, and Auto. Bank Nifty closed last week at 59,069. Staying below the earlier-highlighted resistance of 59,906 increases the probability of a corrective move, potentially extending toward 56,838. However, if Bank Nifty manages to close above 59,906 in the coming sessions, 60,283–60,409 would become the next levels to watch. The Auto Index continues to retain the potential to extend its up-move. From the current level of 27,657, the nearest support is at 27,013, while the next upside target stands at 29,003. The IT Index, which has been both the biggest villain for bulls earlier this year and their saviour in recent months, is currently placed at 38,691. 38,503 remains the key support, with 40,604 as the next upside target.
Overall, the market remains locked in a well-defined range, with decisive levels approaching on both sides. The coming sessions, especially with the year drawing to a close, are likely to play a crucial role in shaping the near-term trend.