‘Dance of Death’: Nifty Stares at Breakdown Zone with Fed Bets

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Fear of the Fed commentary on US inflation possibly rallied bears. In the end, bulls broke down to let indices go in plunge.

By S JHA

Mumbai, December 10, 2025 — Stock market trading is not for untrained. This is an old saying in the street. On Wednesday, Indian equity markets took traders on a wild and swinging trades to throw them at last almost in muddied waters.

With the US Fed meeting concluding tonight, the markets developed jitters after bullish start. The over 80% chance of the US Fed rate cut failed to rally bulls. Fear of the Fed commentary on US inflation possibly rallied bears. In the end, bulls broke down to let indices go in plunge.

“Nifty continues to trade between two critical technical points, with markets awaiting clarity from the Fed outcome,” said Angel One in a note to clients after the market hours. It added that “Nifty on the higher side faced resistance precisely at the 20-DEMA, which coincides with the trendline breakdown zone around 25950–26000.”

“On the flip side, prices continue to defend the key support of the 50-DEMA and the 61.8% retracement of the recent November upmove placed near 25700. The coming session, especially the first couple of hours post the Fed policy announcement, will be extremely crucial,” added the Delhi-based brokerage firm.

It also stated that “a sustained move below 25700 would technically invalidate the recent rally, potentially opening room for further weakness. Conversely, if the bulls are to make a comeback, this is the level where they must hold firm.”

The brokerage argued that “a confirmation of strength would come only once Nifty breaks above the last two sessions’ high of 25950–26000 (20-DEMA zone), which would signal a resumption of the primary uptrend.”

The brokerage cautioned that the “index extended its losing streak to a third day; an early rebound attempt faded, closing 80+ points lower with 3% OI addition, indicating fresh shorts.”

(Disclaimer: This article makes no recommendation for any kind of trades in the stock market)