Nifty Outlook: Can Bulls Hold 26000 on Weekly Expiry? Key Levels to Watch

Indian stock market benchmarks, Nifty 50 and Sensex, experienced slight declines on Monday, December 15th, mirroring global market weakness and continuous outflows of foreign funds. Investor sentiment was also affected by uncertainty surrounding a potential trade agreement between India and the US. The NSE Nifty closed at 26,027.30, a decrease of 19.65 points or 0.08 percent. During the trading day, it reached a high of 26,046.95 and a low of 25,904.75.

The BSE Sensex similarly fell, dropping 54.30 points, or 0.06 percent, to settle at 85,213.36.

Among sectoral indices, the Nifty Bank index saw gains, increasing by 71.85 points (0.12 percent) to close at 59,461.80. The Nifty Auto index experienced the most significant losses, falling by 0.91 percent. Conversely, the Nifty Media index rose by 1.79 percent, followed by Nifty FMCG (up 0.69 percent), Nifty Consumer Durables (up 0.52 percent) and Nifty PSU Bank (up 0.46 percent).

In the broader market, the Nifty Midcap 100 index declined by 0.12 percent, while the Nifty Smallcap 100 index closed 0.21 percent higher.

The India VIX, a measure of market volatility, increased by 1.40 percent to reach 10.25, suggesting expectations of range-bound movement.

**Top Performers and Underperformers**

Within the Nifty 50, 22 stocks showed gains. IndiGo emerged as the top performer, increasing by 2.05 percent, followed by Trent and HUL, each rising by more than 1 percent. Other notable gainers included HCL Tech, Wipro, Infosys, Tata Consumer Products, Tata Steel, ITC, Asian Paints, SBI Life, L&T, Shriram Finance, and BEL.

Conversely, 27 stocks in the Nifty 50 experienced declines during Monday's trading session. M&M, Eicher Motors, ONGC, Bajaj Auto, and JSW Steel saw drops ranging from 1 to 2 percent. Major laggards also included Cipla, Adani Ports, Bajaj Finserv, Maruti, HDFC Life, Titan, HDFC Bank, Hindalco, Power Grid, Airtel, and Bajaj Finance.

**FII and DII Activity**

According to exchange data, foreign institutional investors (FIIs) sold off equities worth Rs 1,468.32 crore on Monday. Domestic institutional investors (DIIs), however, purchased stocks worth Rs 1,792.25 crore.

Vinod Nair, Head of Research at Geojit Investments, noted that persistent foreign fund outflows and a weakening rupee have kept the markets trading within a narrow range. He anticipates that rupee volatility will likely persist until there is clarity regarding the trade deal between India and the US.

Nair added, "Expectations of an earnings recovery in H2FY26, supported by monetary and fiscal growth drivers, are helping stabilize sentiment. Going forward, market momentum is expected to be earnings-led rather than valuation-driven. Investors are also awaiting key economic indicators, including US CPI inflation and unemployment data, which will shape global liquidity expectations and the interest rate outlook for 2026."

**Key Nifty Support and Resistance Levels**

Nilesh Jain, Head – Technical and Derivatives Research Analyst (Equity Research) at Centrum Broking, observed that the Nifty encountered resistance near its 21-day moving average (DMA) at 26,030 on Monday but managed to close above the psychological level of 26,000. He identifies immediate support for the Nifty around 25,900, followed by the 50-DMA near 25,770. Jain maintains a positive outlook for the Nifty overall, recommending a "buy on dips" strategy as long as the index remains above 25,700.

Jain suggests that for the Nifty to move higher, bulls need to decisively break above 26,100, which "will pave the way for further gains toward 26,250." He anticipates volatile movements during Tuesday's weekly expiry session. Currently, the Nifty is respecting a downward-sloping trendline formed by connecting recent swing highs.

Nandish Shah, Deputy Vice President at HDFC Securities, stated that a sustained move above 26,058 would signal a short-term bullish breakout, potentially leading to higher targets of 26,202 and 26,330. He expects the 25,900 level to act as short-term support.

Amruta Shinde, Technical & Derivative Analyst at Choice Equity Broking, points to immediate resistance for the Nifty in the 26,150 to 26,200 range. She believes that a sustained breakout above this zone could lead to a move towards 26,300. On the downside, she identifies key support levels at 25,850 and 25,900.

Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, noted that the current market action suggests an attempt to break out above crucial overhead resistance around the 26,000-26,100 levels. He believes that "the underlying trend of Nifty continues to be positive" and that repeated testing of this hurdle could result in a decisive breakout above this key resistance in the short term. A sustainable breakout is expected to open up an upside target of around 26,300-26,400 in the near term. He places immediate support for the Nifty at 25,900.

**Nifty OI Data**

Analysis of Nifty's derivatives data indicates significant Call writing at the 26,100 strike price, coupled with strong Put open interest at 26,000. This suggests a narrow trading range in the short term.

Shinde adds that a sustained close above 26,300 will be crucial to revive bullish momentum, while failure to do so may extend the current consolidation phase in the coming sessions.

_(Disclaimer: This article is for informational purposes only and should not be considered investment advice. Consult with a qualified financial advisor before making any investment decisions.)_