Buyers stepping in whenever prices dip, a signal of sustained directional strength
At a moment when markets search for direction, technical analyst Sudeep Shah of SBI Securities reads the Nifty 50's chart as a quiet gathering of forces — buyers defending dips, momentum recovering, and moving averages beginning to tilt upward like a compass finding north. Within this broader constructive landscape, two large-cap names — Lupin in pharmaceuticals and Hindalco in metals — have traced the kind of disciplined, volume-backed patterns that technical practitioners associate with genuine conviction rather than noise. The story unfolding is one of selective strength: not every sector moves together, but enough pieces are aligning to suggest the market's next chapter may be written higher.
- The Nifty 50 has spent three weeks forming small-bodied candles with lower shadows — a quiet but persistent signal that buyers are absorbing every dip before sellers can press their advantage.
- The critical test arrives at the 26,150–26,200 resistance band; a decisive close above 26,200 could unlock a swift move toward 26,350 and then 26,500, potentially setting new record highs.
- Lupin and Hindalco have each delivered technically clean setups — one through a defended uptrend, the other through a volume-backed breakout from an 11-session consolidation — giving Shah confidence to recommend accumulation with defined stop-losses.
- The metal sector is asserting itself broadly, with Hindustan Zinc and NALCO joining Hindalco in breaking above resistance on rising volume, while the sector's ratio chart reclaims its upward trendline.
- Bank Nifty remains the conspicuous laggard — indecisive candlesticks, a sideways RSI, and an unbroken resistance ceiling at 59,800 keep it in a holding pattern while the rest of the market leans bullish.
The Nifty 50 finds itself at a technical crossroads that analysts describe as quietly promising. For three consecutive weeks, the index has formed candles with small bodies and pronounced lower shadows — a pattern suggesting buyers consistently absorb weakness. Trading above both its short- and long-term moving averages, with those averages now tilting upward, the index has also seen its daily RSI jump from 44.5 to 54.5. The convergence of trend, momentum, and buying support points toward a potential next leg higher, with the immediate hurdle at 26,200 and targets of 26,350 and 26,500 beyond it.
Sudeep Shah, head of technical and derivatives research at SBI Securities, has identified two large-cap stocks as particularly compelling within this environment. Lupin has built a textbook uptrend since finding support near 1,900 rupees, defending its 20-day moving average across multiple sessions while its RSI climbed from 53 to 65. With the MACD approaching a bullish crossover, Shah recommends accumulating between 2,100 and 2,120 rupees, placing a stop-loss at 2,010 and targeting 2,260. Hindalco, meanwhile, broke free from an 11-session consolidation range on healthy volume, with its RSI at 68 and directional indicators widening. Shah sees accumulation between 846 and 855 rupees as attractive, with a stop-loss at 820 and a target of 910.
The broader metals space is stirring. Hindustan Zinc and NALCO have both cleared prior resistance levels on volume spikes, and the sector's ratio chart against the broader market has bounced from its rising trendline — a sign of renewed relative strength. The IT sector, too, remains constructive, with its RSI finding support near 60 during last week's dip and the 37,500 level expected to hold as a floor on the way toward 39,000 and 39,500.
Bank Nifty stands apart from the optimism. A 0.66 percent decline last week, a second consecutive small-bodied candle with a long lower wick, and a sideways RSI all paint a picture of indecision. The index hovers near its 20-day exponential moving average, and until it clears 59,800 with conviction, a rally toward 60,500 or 61,000 remains potential rather than reality. Among individual names, CCL Products surged nearly 6 percent on a moving average breakout, Swiggy emerged from consolidation with volume support, and City Union Bank defended a key technical level — while New India Assurance, despite a sharp rebound, continues to bear the weight of a broader downtrend.
The Nifty 50 is sitting at a technical inflection point. For three weeks running, the index has printed candlesticks with small bodies and pronounced lower shadows—the kind of pattern that whispers of buyers stepping in whenever prices dip. Right now it's trading above both its short-term and long-term moving averages, and those averages themselves are beginning to tilt upward, a signal that often precedes a sustained directional move. The momentum indicators are cooperating: the daily RSI has bounced sharply from 44.5 to 54.5, comfortably above its nine-day average. All of this convergence—the trend, the momentum, the buying support at lower levels—suggests the index may be preparing for its next leg higher.
Sudeep Shah, head of technical and derivatives research at SBI Securities, sees the setup as constructive. The immediate resistance zone sits between 26,150 and 26,200. If the index breaks decisively above 26,200 and holds there, Shah expects a quick move toward 26,350, then 26,500. The question is whether the Nifty will consolidate in a range next week or push through to record highs. The technical picture leans toward the latter, though nothing is certain.
Within this broader strength, Shah is backing two large-cap stocks for accumulation. Lupin has shown resilience after finding support near 1,900 rupees and has been climbing in a pattern of higher highs and higher lows—the textbook signature of a healthy uptrend. Over the last three sessions, the stock has repeatedly defended its 20-day moving average, pulling in fresh buyers. The RSI has climbed from 53 to 65, signaling strengthening bullish momentum. The directional indicator has crossed in favor of buyers, and the MACD is on the verge of a bullish crossover. Shah recommends accumulating Lupin in the 2,120 to 2,100 rupee zone, with a stop-loss at 2,010. The near-term target is 2,260.
Hindalco Industries has just broken out of an 11-session consolidation band between 834 and 800 rupees, closing firmly above the range on healthy volume. The metal sector ratio chart shows renewed outperformance, and the RSI has climbed to 68, indicating strong momentum. The directional indicators are widening, suggesting expanding buying pressure. Shah sees the technical setup as favoring continued upside as long as the stock holds above its breakout zone. He recommends accumulating between 855 and 846 rupees, with a stop-loss at 820. The near-term target is 910 rupees.
The broader metal sector is showing fresh strength. Both Hindustan Zinc and NALCO have delivered breakouts above earlier resistance levels, and the metal-to-broader-market ratio has taken support from its upward-sloping trendline and is moving higher. These breakouts carry volume conviction, and the momentum indicators—RSI in rising mode, MACD well above zero, widening directional indicator lines—all point to further sectoral outperformance in the near term.
Bank Nifty, by contrast, is muddled. It underperformed the broader market last week, declining 0.66 percent and closing at 59,390. For the second week in a row, it formed a small-bodied candlestick with a long lower wick, showing buying support at lower levels but an absence of strong follow-through. The index has been hovering around its 20-day exponential moving average, and the RSI is moving sideways—all signs of indecision. The key resistance zone is 59,700 to 59,800. A sustained breakout above 59,800 could trigger a sharp rally toward 60,500 and even 61,000, but that breakout has not yet arrived. On the downside, immediate support sits at 58,800 to 58,700.
The IT sector remains bullish overall, trading above both short- and long-term moving averages. During last week's correction, the RSI found support near 60 and rebounded—a bullish sign under RSI range-shift rules. The 20-day moving average zone of 37,600 to 37,500 will act as important support. As long as the index holds above 37,500, it is likely to continue higher and test 39,000, then 39,500 in the near term.
Among the other names Shah analyzed: CCL Products broke decisively above its 20-day moving average zone after four sessions of consolidation, closing nearly 6 percent higher on Friday, with RSI improving and directional indicators turning bullish. New India Assurance has rebounded sharply from 154 rupees but remains in a broader downtrend; the MACD has turned positive but is still well below zero, suggesting the move is corrective rather than a true reversal. Swiggy broke out of its 376 to 411 rupee consolidation range on December 12 with volume support, RSI rising from oversold levels, and directional indicators turning bullish. City Union Bank has defended its 20-day moving average after hovering near it for four sessions, closing decisively higher on December 12, with RSI improving and directional lines widening to suggest short-term strength remains intact.
Notable Quotes
Lupin continued moving up in a higher-high, higher-low structure, signalling a healthy uptrend along with bullish momentum indicators— Sudeep Shah, SBI Securities
The technical setup favours continued upward momentum as long as the stock holds above its breakout zone— Sudeep Shah, on Hindalco Industries
The Hearth Conversation Another angle on the story
When you see those three weeks of small-bodied candles with long lower wicks, what does that actually tell you about what's happening in the market?
It's a conversation between buyers and sellers. The small body means the open and close are close together—no decisive move either way. But that long lower shadow means sellers tried to push the price down, and buyers came in and said no, we're not going lower. That happened three weeks in a row. It's not aggressive buying, but it's persistent buying at lower levels.
So the Nifty breaking above 26,200—that's not just a number, is it?
No. It's a threshold. Right now the index is sitting below it. If it breaks above and holds there, it signals that the buyers who've been defending lower levels are now confident enough to push higher. Once that happens, the next targets—26,350, 26,500—become more likely because momentum tends to follow through.
Why are you more confident about Lupin than, say, New India Assurance, when both have shown recent strength?
Lupin is in a clean uptrend with higher highs and higher lows. Every technical indicator is pointing the same direction—RSI climbing, directional indicators crossing in favor of buyers, MACD about to cross. New India Assurance bounced, yes, but it's bouncing inside a downtrend. The MACD is positive but still below zero. That's a rebound, not a reversal. Different animals.
The metal sector seems to be the place to be right now. Is that just luck, or is there something structural happening?
The ratio line—the metal index divided by the broader market—has taken support from its trendline and is moving higher. That means metals are outperforming. Volume is backing the breakouts in Hindustan Zinc and NALCO. When a sector breaks out on volume and the relative strength ratio confirms it, that's not luck. That's conviction.
Bank Nifty looks stuck. What would change your mind about it?
A sustained break above 59,800. Right now it's hovering around its 20-day moving average, RSI is sideways. It's indecisive. If it breaks above 59,800 and holds, then the 60,500 to 61,000 move becomes real. Until then, it's just consolidation.
What's the biggest risk in this whole setup?
Overconfidence. The Nifty is above its moving averages, momentum is improving, but we haven't broken through the key resistance yet. If 26,200 holds and the index rolls over, all these bullish signals become false signals. That's why the stop-losses matter—they're not pessimism, they're discipline.