Indian equity markets are poised to welcome the New Year on a buoyant note, with the benchmark indices, Sensex and Nifty 50, likely to open at record highs on Monday, January 1. The positive setup comes amid thin trading volumes as most major global markets remain closed for the holiday.
Market Setup and Previous Session Momentum
The trend indicator, Gift Nifty, was trading at a fresh peak of 26,341, marking a gain of 66 points or 0.25% over the previous close of Nifty futures. This points towards a flat but positive opening for the domestic indices.
This optimistic start follows a strong finish to 2025. On the final trading session of the year, both indices witnessed broad-based buying. The Sensex surged 546 points, or 0.64%, to settle at 85,220.60. Similarly, the Nifty 50 climbed 191 points, or 0.74%, to close at 26,129.60. The rally was fueled by short covering, optimism about corporate earnings growth, progress on a potential India-US trade deal, and expectations of foreign investor inflows.
Analyst Views on Sensex and Nifty Trajectory
As markets step into 2026, analysts believe the technical structure supports further gains, provided crucial support levels are defended. However, investors are treading cautiously ahead of the December quarter earnings season and are monitoring geopolitical developments.
Sensex Technical Outlook
Shrikant Chouhan, Head of Equity Research at Kotak Securities, noted the formation of a promising reversal pattern on the daily charts. He stated that 84,800 and 85,000 are immediate support zones for the Sensex. As long as the index trades above these levels, the bullish sentiment could continue, targeting 85,800 and 86,100. A break below 84,800 would weaken the trend.
Echoing this, Amruta Shinde of Choice Equity Broking observed that the index convincingly held above 85,000, indicating accumulation at lower levels. She sees support at 84,700–84,800 and immediate resistance at 85,700–85,900, favouring a buy-on-dips strategy.
Nifty 50 Prediction and Derivatives Data
Ajit Mishra, SVP–Research at Religare Broking, highlighted that the Nifty is testing the upper end of its consolidation range near 26,200. A decisive breakout above this level could trigger the next upward leg, while failure may invite profit-booking. He advises a sector-specific approach, favouring banking, auto, and metal stocks.
Osho Krishan of Angel One pointed out the index's resilience, with the broader structure of higher highs and higher lows remaining intact. He identified 26,000 (20 DEMA) as near-term support and suggested that a sustained move above 26,200 could open the path towards lifetime highs of 26,325.
On the derivatives front, Aakash Shah from Choice Equity Broking noted subdued volatility and supportive options data. Unwinding of call positions near 26,000 and fresh put writing at higher strikes reinforce a positive bias for early January.
Bank Nifty to Set the Near-Term Tone
Analysts believe banking stocks will be crucial in determining the market's near-term direction. Vatsal Bhuva of LKP Securities said Bank Nifty showed early signs of improving sentiment, with the RSI indicating a bullish crossover. He pegged immediate support at 59,200 and resistance at 59,750, noting that holding above the 20-day SMA is key for confirming strength.
Aakash Shah added that the index's outperformance and defence of key supports signal accumulation. He sees the immediate resistance zone at 59,800–59,900, with 59,300–59,400 acting as critical support.
Disclaimer: The views and recommendations above are from individual analysts or broking firms. Investors are advised to consult certified experts before making any investment decisions.
