Trade Setup For Jan. 2: Nifty Consolidates Gains; Bulls Eye 26,200 Breakout
The immediate short-term support is seen at the 26,000–26,050 band.
The Indian equity markets kicked off the first trading session of 2026 on a cautious and consolidative note, with the NSE Nifty 50 managing to extend its winning streak for the second consecutive day.
Despite the range-bound movement, the Nifty managed to sustain above the critical 26,100 zone, supported by strong gains in the Auto and Metal sectors.
Technical parameters suggest that the short-term texture of the market remains upward, though the current phase is one of consolidation. Nandish Shah, deputy vice president at HDFC Securities, highlighted that turnover on the NSE’s cash segment dipped 21%, reflecting the holiday-thinned participation.
A fresh uptrend rally is expected only after the dismissal of the 26,200–26,234 zone. Shrikant Chouhan notes that a breakout above this level could push the market toward 26,300–26,350. Aakash Shah of Choice Broking places immediate resistance in the 26,250–26,300 range.
The immediate short-term support is seen at the 26,000–26,050 band. Nandish Shah identifies the 25,900 zone as a crucial floor, while Chouhan warns that the sentiment could turn vulnerable if the index slips below 25,950.
Bank Nifty Outlook
The Bank Nifty traded in a consolidative manner following its recent outperformance, as banking heavyweights saw mixed activity.
The immediate hurdle is placed at 59,900–60,000. A decisive breakout above this range is essential to open the doors for further upside toward all-time highs.
The immediate support for the banking index is positioned at 59,400–59,500, with a stronger base lying near the 59,000 mark.
Market Recap
The Nifty 50 managed a slim gain of 0.06% to close at 26,146, sustaining its momentum above the 26,000 mark. While the Sensex ended marginally lower by 32 points to close at 85,188.
While Auto, Realty, and Metal stocks saw healthy buying, the sharp slump in FMCG heavyweights capped the upside.
Market breadth remained positive for the second straight session with an advance-decline ratio of 1.14 on the BSE, suggesting that stock-specific opportunities continue to dominate the early January trade.
The Auto Index was the star performer of the day, rallying 1% on the back of positive expectations. However, the FMCG Index faced a brutal correction, shedding over 3%.
