Trade Setup For Dec. 19: Nifty Holds Near Key Support, Analysts See Range-Bound Moves Ahead

The Nifty 50 is trading near recent support levels, with market direction likely to remain range-bound in the near term unless a decisive breakout or breakdown emerges, according to analysts.

The short-term trend of the market continues to be choppy with weak bias, said Nagaraj Shetti, senior technical research analyst at HDFC Securities. 

The Nifty is expected to find support around 25,700-25,650 levels before bouncing back firmly in the next few sessions, he said. Immediate resistance is placed at 25,900-25,950 levels.

Moreover, recent trading patterns show that the blue-chip index has struggled to hold gains during intraday rallies, with selling pressure emerging each time prices move closer to this upper band. This suggests that traders remain cautious in the near term, according to Mayank Jain, market analyst at Share.Market (PhonePe Wealth).

On the macro front, the street will await the Bank of Japan's monetary policy decision Friday morning, with the central bank expected to raise interest rates from 0.5% to 0.75%.

The Nifty Bank index has formed a small bullish candlestick pattern with a long upper shadow highlighting consolidation amid stock specific action, according to Bajaj Broking.

The index on expected lines is seen consolidating and forming a base in the range of 58,500-60,100.

"We expect the index to extend the current consolidation in the coming sessions. Key short-term support is placed at 58,200-58,600 levels being the confluence of the recent low and the major breakout area. On the higher side a move above 59,500 will open further upside towards the all-time high of 60100 in the coming week," analysts at the brokerage said in a note.

India's benchmark equity indices closed flat on Thursday after a choppy session.

The Nifty rose in the first half to an intraday high of 25,902 but gave up gains later as selling pressure emerged in the latter half of the day. The index settled 3 points lower at 25,815.55. The BSE Sensex dipped 77.84 points (0.09%) to 84,481.81.

Broader markets outperformed, with the midcap index gaining 0.34% and the small-cap index rising 0.13%.

On the sectoral front, realty stocks edged up 0.3%, while IT emerged as the top performer, rising over 1%, supported by selective buying and currency-related tailwinds. In contrast, auto, media, pharma, oil & gas, and capital goods stocks remained under pressure, shedding between 0.3% and 1%.