Trade Setup for January 12: TCS, HCLTech will set the tone for Nifty this week

The equity markets remained under pressure for the fifth straight session on Friday, with the Nifty slipping below the 25,700 mark amid broad based selling.

The benchmark index extended its decline through the session and ended the day lower by 193 points at 25,683.

The Nifty had opened 36 points weaker and stayed under sustained selling pressure throughout the day, with more than 35 stocks closing in the red.

Friday's fall also capped a losing week for the markets, with the Nifty declining across all five trading sessions. The index ended the week down 2.45%, marking its sharpest weekly fall since the week ended September 26, 2025.

The sell-off last week has taken the Nifty 50 index to its lowest level in the last two months. Last week's sell-off has wiped out ₹15 lakh crore in the overall market capitalisation of BSE-listed companies.

Losses have been led by heavyweights like HDFC Bank, which has seen its worst weekly fall since January 2024, and lost over ₹1 lakh crore in market capitalisation this week.

In an otherwise weak trading session on Friday, Asian Paints, ONGC, and HCL Tech managed to buck the trend, emerging as the gainers in the Nifty pack. Conversely, Adani enterprise, NTPC, and Adani port succumbed to intense selling pressure, ending the day as the top laggards.

While Oil & Gas, IT, and PSU Banks showed relative resilience, the rest of the sectoral Indices ended in the red. The Realty, Auto, and Consumer Durables indices bore the brunt of the sell-off, recording the most significant losses of the day.

The pain was even more pronounced in the broader space where Nifty Midcap 100 Index slipped 0.79% while Nifty Smallcap 100 plunged 1.81%.

The next week is when the action begins with regards to quarterly results. Tata Consultancy Services and HCL Technologies report results on Monday, while Reliance Industries, the index heavyweight, reports results on Friday.

Nagaraj Shetti of HDFC Securities said a break below the 25,700 support could open the door for a deeper decline towards 25,400 in the coming week, while immediate resistance is seen at 25,900.

Nilesh Jain of Centrum Broking said that although the Nifty attempted a pullback, it faced strong resistance near the 50-day moving average, placed around the 25,960 mark.

He added that the next important support lies near the 100-day moving average at 25,540, and as long as the index holds above this zone, a rebound towards 25,900 levels cannot be ruled out.

LKP Securities' Rupak De said that repeated bouts of selling pressure dragged the Nifty to a multi-day low, with market sentiment turning decisively negative.

In the near term, De expects the trend to remain weak, with potential downside towards the 25,550-25,500 zone, while resistance on the upside is placed at 25,850.

Nandish Shah of HDFC Securities said a decisive break below the 100-day EMA at 25,619 could accelerate selling towards the next major support at 25,318, which is the November 2025 swing low. Any recovery attempts, Shah added, are likely to face strong resistance in the 25,950-26,000 range.

The Nifty Bank index closed below its 20-day EMA for the first time since December 29, a sign that the short-term uptrend is losing steam.

Going ahead, for Nifty Bank, the rising trendline zone of 59,100-59,000 will act as an immediate support. Any sustained move below the 59,000 level could lead to index extending its weakness further down towards the 58,500 level. On the upside, the zone of 59,500-59,600 will act as an as immediate resistance.