Nifty Prediction For Monday, December 22:
Indian equity markets ended the week on a steady footing, with the Nifty 50 closing at 25,966, as late buying helped limit weekly losses despite persistent macro and currency-related concerns. Market participants now enter the holiday-shortened week with cautious optimism, as technical indicators suggest the broader uptrend remains intact, though near-term consolidation cannot be ruled out.The NSE Nifty on December 19 recorded a strong closing with nearly 150 points higher, trimming the weekly losses. During the week ended December 19, the Nifty declined 0.31% to 25,966, while the Sensex slipped 0.40% to 84,929, indicating a phase of consolidation after recent volatility.
However, the Nifty futures, or
the Gift Nifty, are currently up by 0.54% or 141 points to trade at 26,172, indicating a gap-up opening on Monday as of now.
Markets consolidate amid mixed cues
According to Religare Broking, subdued sentiment stemmed from global macroeconomic data, currency weakness and lingering concerns around an India-US trade agreement.
“Markets ended the week with marginal losses as mixed macroeconomic data, a depreciating rupee, and continued uncertainty over the timing of a potential India-US trade deal kept investor sentiment cautious,” said Ajit Mishra, senior vice-president (research) of Religare Broking.
He added that while selling pressure dominated most sessions, value buying and renewed foreign portfolio investor (FPI) interest toward the end of the week helped limit losses. “The Nifty declined 0.31% to 25,966, indicating a phase of consolidation after recent volatility,” Mishra said.
Rupee recovery, FPI inflows lift sentiment
A sharp rebound in the rupee from record lows during the end of the week and selective FPI buying helped stabilised market sentiment. Ponmudi R, CEO of Enrich Money, said the return of foreign flows could act as a catalyst for the next leg of the market’s move.
“The rebound was driven by broad-based buying across sectors, supported by a sharp recovery in the Indian rupee and a return of foreign portfolio investors, who turned net buyers over the past two sessions,” he said.
Lower-than-expected US inflation data has also revived expectations of monetary easing by the US Federal Reserve, which historically supports emerging market equities, including India.
Nifty technical outlook: Supports holding firm
From a technical perspective, analysts believe the Nifty’s structure remains positive as long as key supports are protected.
Ajit Mishra noted that the index has reclaimed its short-term moving average. “The Nifty has reclaimed its 20-day DEMA around the 25,950 level. Sustained strength above this zone is essential for a move toward the 26,050-26,200 range,” he said.
On the downside, he cautioned that “the previous swing low near 25,700 remains a key support. A breakdown below this level could broaden the consolidation, with the next major support around 25,450”.
Echoing this view, Ponmudi R said dip-buying near the 50-day EMA has reaffirmed the strength of the broader trend. “As long as the Nifty holds above the 25,800-25,900 zone on a closing basis, the bullish bias remains intact,” he said.
Key resistance levels to watch
Analysts see the 26,000-26,100 zone as an immediate hurdle for the index. A sustained breakout above this band could open the door for a move toward 26,300-26,500, supported by improving global cues and stronger foreign inflows.
However, experts caution that the durability of the upmove will depend on upcoming global macro data, particularly US GDP and core PCE inflation numbers, which could influence risk appetite.
Strategy for December 22
Given the mixed macro backdrop and the holiday-shortened trading week, market participants are advised to remain selective.
“Risk management remains crucial in the coming sessions. Position sizes should be kept moderate, and a buy-on-dips strategy near key support levels is preferable to chasing momentum,” Mishra said.
Overall, while intermittent volatility cannot be ruled out, analysts believe the Nifty’s bullish bias remains intact as long as it continues to defend critical support zones.
The stock market will remain closed on December 25 on account of Christmas.
Infosys ADR surges 38%
IT major Infosys’ American Depositary Receipt (ADR) surged more than 38% in early US trading, briefly touching nearly $27, before the New York Stock Exchange (NYSE) halted trading, according to Reuters. The sharp move came even as Infosys shares in India closed with modest gains, ending 0.7% higher at Rs 1,638 on the NSE. The unexpected rally and subsequent halt left investors asking what caused the spike and whether it reflects a broader shift in sentiment toward Indian IT stocks.
