Nifty Trade Outlook for Dec 27: Immediate support at 23,500, breakout potential above 23,855

The NSE Nifty 50 has been consolidating within a defined range, with immediate support near 23,500 and resistance at 23,855. Analysts believe that a decisive move above the 23,855 level could push the index towards the 24,000-24,100 range, while a drop below 23,500 might signal further downside.

Hrishikesh Yedve, Assistant Vice President of Technical and Derivatives Research at Asit C. Mehta Investment Intermediates Ltd., highlighted that Nifty has been testing the 200-Day Simple Moving Average (200-DSMA) resistance at 23,855 over the past three sessions but has failed to sustain above it, resulting in a small red candle on the daily chart. This level is expected to act as a key hurdle for the index.

“The index is anticipated to consolidate within the 23,500-23,850 range in the short term, with a breakout in either direction determining its future trajectory,” Yedve said. If the index manages a sustained move above 23,855, it could target 24,000-24,100. On the downside, support is seen at 23,500.

Siddhartha Khemka, Head of Research, Wealth Management at Motilal Oswal Financial Services Ltd., mentioned that the market remains subdued due to factors like persistent FII selling, rising bond yields, and a stronger dollar index, dampening investor sentiment. With no major triggers expected in the near term, markets are likely to continue their range-bound activity.

Shrikant Chouhan, Head of Equity Research at Kotak Securities, added that the Nifty has shown support near the 23,650/78,150 levels and experienced profit booking around the 200-DSMA at 23,850/78,900. For traders, the key breakout level is 23,850/78,900. A move above this level could target 23,950-24,000 or 79,200-79,500, while a drop below 23,650/78,150 could lead the index to test 23,500/77,700 levels.

Meanwhile, the Bank Nifty closed marginally lower at 51,171, with support at 50,560 (200-DSMA) and resistance at 51,635 (100-DEMA). The index is expected to consolidate between 50,550 and 51,650 in the short term, with a breakout in either direction setting the future trend.

Indian equity markets saw a muted close on Thursday, with the Nifty 50 gaining 0.10% or 22.55 points to settle at 23,750.20, and the Sensex closing at 78,472.48. Both indices had risen by approximately 0.5% during the day but lost momentum amid the global holiday season.

The rupee weakened to a record low of 85.26 against the US dollar, marking a 6-paise decline from the previous day. The currency hit an all-time intraday low of 85.29, reflecting continued downward pressure due to global uncertainties and the strength of the US dollar. The dollar index remained high at 108.15, bolstered by persistent US inflation, geopolitical concerns, and favorable interest rate differentials.