Nifty Hangs with 50-DEMA as Bears Strike amid Shorts Spike
Stock Market on Tuesday! (Image credit X.com)
The Nifty index registered a 6%+ jump in OI, indicating fresh short build-up and a bearish undertone, said the brokerage.
By S JHA
Mumbai, December 9, 2025 — With technical structure in tatters, analysts believe that Nifty must defend the November low to stage a comeback from relentless selloff in the street. The Nifty expiry on Tuesday witnessed heightened volatility in the index as option writers rejigged their positions.
“On the technical front, the day reflected a mixed setup. While overall sentiment still appears fragile, the index broke below the trendline support (joining the higher bottoms of 24731 and 25318) and also slipped below the 20-DEMA,” noted Angel One in a note to clients after the market hours.
The Delhi-based brokerage firm stated that “Nifty simultaneously found support at the 50-DEMA and the 61.8% retracement level of the recent rally (25318–26325) and formed a candle pattern indicating buying interest near this crucial zone.” “In our view, Nifty may now consolidate within a broader 25700–26000 band ahead of the key Fed policy outcome, and the next directional move is likely to emerge only on a breakout from this range,” it added.
Traders are keeping fingers crossed at the outcome of the Fed meeting amid reports that the US is in the midst of heating up of prices of consumer goods. “A breakdown below the 61.8% retracement at 25700 would negate the recent up-move from November lows and may open the gates for a deeper correction,” added Angel One.
The brokerage said that “conversely, a sustained move above the 20-DEMA near 26000 would help revive optimism and could propel Nifty back toward the 26200–26300 resistance zone.”
It also stated that “the index registered a 6%+ jump in OI, indicating fresh short build-up and a bearish undertone, with major Put OI at 25,800 and Call OI at 26,000 suggesting a meaningful move only beyond these levels.”
The brokerage grimly noted that “market breadth weakened sharply, with 70% of Nifty 50 stocks trading below their 10- & 20-EMA, and over 83% slipping under their 5-EMA.”
(Disclaimer: This article makes no recommendation for any kind of trades in the stock market)
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