By V K Sharma
The Nifty closed Friday with a gain of 148 points or 0.57%, ending the week at 26,046, but still recording a weekly loss of 140 points or 0.53%. Despite this, sentiment remains cautious as the index continues to struggle near record levels.
Though the Nifty made a new intraday all-time high of 26,325 on December 1, it is yet to close above the 26,216 mark registered on September 26, 2024. The index has come tantalisingly close several times — on November 27, November 28, and December 1, 2025 — but has failed to hold higher ground. So near, yet so far.
For the past two weeks, the Nifty has closed lower, halting its pattern of higher highs and higher lows. In fact, it has now formed lower tops and lower bottoms on both daily and weekly charts. We have drawn trendline number 81 connecting the highs of December 1 (26,325) and December 5 (26,202). This trendline will now act as immediate resistance, with Friday’s close just below it.
Beyond this trendline, the next resistance lies at the all-time intraday high of 26,325 and subsequently at 26,650. On the downside, support is placed at 25,693, the swing low formed after the new peak.
Meanwhile, the most important development for the market last fortnight was Russia’s decision to invest part of its rupee trade surplus in Indian equity markets through the mutual fund route — a move that could offer much-needed liquidity and diversification to domestic flows.
Global cues remained mixed. The US markets ended the week unevenly, with the S&P 500 and Nasdaq falling 0.63% and 1.62%, respectively, while the Dow Jones Industrial Average gained 1.05%. The FOMC, the policy-making arm of the US Federal Reserve, cut rates by 0.25% to 3.5%-3.75% in a 9:3 split and announced a $40 billion monthly treasury purchase plan to maintain liquidity and rate control.
The next major event for global investors will be the Bank of Japan’s two-day policy meeting on December 19, where the BOJ is expected to raise its policy rate to around 0.75% from 0.5% — the first move above that level since 1995.
Back home, the RBI had cut rates by 0.25% at its last week’s meeting, as we had forecast earlier. The central bank will also inject additional liquidity into the system. India’s CPI rose to 0.71% in November 2025, up from October’s 0.25%, signalling a mild uptick in inflation largely due to base effects. Hopefully, the easing liquidity will help maintain a healthy inflation balance.
The Winter Session of Parliament concludes on December 19, adding potential tailwinds for the market. Investors are advised to remain cautiously invested and selective in IPOs.