Trade Setup For Jan. 7: Nifty Maintains Positive Bias Despite Losses; 26,100 Seen As Immediate Support

The Indian stock market indices extended losses on Tuesday to end lower on expiry day. Despite this, analysts project that the NSE Nifty 50 is likely to maintain a positive bias in the upcoming sessions.

"From a technical standpoint, Nifty continues to hold above the breakout zone and remains above key short-term moving averages, thereby maintaining a positive bias," said Rajesh Bhosale, equity technical analyst at Angel One.

On the downside, the index will find immediate support at 26,100–26,000 while on the upside, immediate resistance lies between 26,300 and 26,400 levels.

"The index has formed a high wave candle with a lower high and a lower low, signalling consolidation with corrective bias for the second session in a row around the all-time high after last week strong up move," highlighted Bajaj Broking Research.

Analysts' advice traders to use the brief consolidation as a buy-on-dips approach, as long as the index sustains above the support area of 26,000-25,900.

The PSU Bank segment stood out as the star of the Nifty Bank sector, outperforming the private bank segment.

"Bank Nifty formed a small bull candle with shadows in either direction, signalling consolidation amid stock-specific action around the all-time high," said Bajaj Broking Research.

Immediate support is placed at 59,500 levels, while resistance for the index lies between 60,400 and 60,500 levels.

Indian equities extended decline to end lower on expiry day. Nifty ended 71.60 points or 0.27% lower at 26,178.70 while Sensex ended 376.28 points or 0.44% down at 85,063.34. Nifty and Sensex fell nearly 0.50% intraday.

Broader indices closed lower. Nifty Midcap 150 ended 0.20% lower and Nifty Smallcap 250 closed 0.31% lower. Most sectoral indices rose with Nifty pharma and Nifty PSU bank leading the gains, while Nifty oil and gas and Nifty media were among the losers.

The market breadth was skewed in the favour of sellers, as 1,735 stocks declined, 1,500 advanced and 195 remained unchanged on the BSE.

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