Weekly Trend Report
- 08th Dec 2025
Week Gone By
Domestic equities ended the week on a muted note, with the frontline indices closing almost flat despite notable intra-week volatility. The market remained under pressure for three out of the five sessions, weighed down by a weakening rupee, persistent FII outflows and caution ahead of the RBI’s monetary policy decision. Sentiment was subdued early in the week as the Sensex and Nifty retreated from record highs amid concerns over foreign outflows, a heavy IPO pipeline and uncertainty around India–US trade negotiations. Conditions worsened mid-week as the rupee slipped to fresh lows, but markets stabilized on Thursday and rebounded sharply on Friday after the RBI delivered a 25-basis-point repo rate cut, helping lift investor sentiment despite mixed global cues. In the week ended on Friday, 05 December 2025, the S&P BSE Sensex rose marginally 5.70 points or 0.01% to settle at 85,712.37. The Nifty 50 index added 16.50 points or 0.06% to settle at 26,186.45.
Week Ahead
Indian equities could start the week on a cautiously hopeful tone. The Reserve Bank of India (RBI) cut the repo rate by 25 basis points to 5.25%, offering renewed support to growth and credit-sensitive sectors. On Friday (12 December 2025), the Inflation Rate for the month of November would be announced. In the United States, the weekly ADP Employment data would be released on Tuesday (09 December 2025). On Thursday (11 December 2025), the US Fed would announce its latest interest rate decision. Several Federal Reserve officials favored lowering the target range for the federal funds rate in October, though many could have supported leaving rates unchanged, and some opposed a reduction, minutes from the last FOMC meeting showed. In China, the Balance of Trade data for November 2025 would be unveiled on Monday (08 December 2025). On Wednesday (10 December 2025), the Inflation Rate for November 2025 would be announced.
Technical Overview
- The Nifty 50 index has witnessed a week of healthy consolidation after registering a fresh all-time high of 26,325. The index faced minor profit-booking at higher levels but managed to close the week comfortably above the 26,100 mark.
- On the weekly chart, the index has formed a small-bodied candle with wicks on both sides. This indicates temporary indecision between bulls and bears after a sharp rally, which is a typical characteristic of a breather phase in a strong uptrend.
- The daily chart structure resembles a bullish flag pattern. The vertical rally from late November forms the pole, and the current sideways movement represents the flag. A breakout from this pattern usually signals trend continuation.
- The immediate hurdle is the fresh all-time high of 26,325. A breakout above this level will confirm the resumption of the uptrend, opening the path towards the technical extension target of 26,550 – 26,600.
- The index has successfully defended the 26,000 – 26,050 zone during intraday dips this week. This level, which aligns with the short-term 10-day moving average, is acting as a dynamic support floor.
- The daily RSI has cooled off from overbought levels and is currently hovering around 60. This implies that the froth has been removed from the market, creating room for the next leg of the rally without being overheated.
- The MACD histogram on the daily chart has flattened slightly, reflecting the consolidation. However, the signal lines remain firmly in positive territory without a bearish crossover, confirming the primary trend remains bullish.
- The Parabolic SAR dots continue to trend below the price candles on the daily chart, maintaining a positional buy signal.
- Volume during this consolidation week has been lower compared to the breakout week. This decline in volume during the pullback is a bullish sign, indicating a lack of aggressive selling pressure at these record highs.
- Conclusion:The Nifty 50 is undergoing a constructive consolidation phase after hitting a record high of $26,325$. The formation of a “Bullish Flag” on the daily chart and a “Spinning Top” on the weekly chart suggests the market is gathering strength for the next upward move. The primary trend remains robust as long as the index sustains above the $26,000$ psychological mark. The strategy remains “buy on dips” with a focus on a breakout above the all-time high.
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