Indian equity benchmarks ended the previous session on a cautious note as selling pressure continued to dominate. Both the Nifty 50 and Bank Nifty displayed signs of weakening momentum, supported by bearish technical indicators and options positioning. While volatility remains low, the broader setup suggests traders should stay alert, as sustained weakness could invite further downside.

Nifty 50 Technical Outlook

Current Level: 25,819

The Nifty 50 formed a bearish candle on the daily chart, reflecting growing dominance of sellers. The index continues to trade below its short-term moving averages (10-day and 20-day EMAs) and the midline of the Bollinger Bands, highlighting near-term pressure. However, it is still positioned above the 50-day EMA and the lower Bollinger Band, offering limited support.

Momentum indicators remain weak. The RSI has slipped to 46.47, indicating loss of strength, while the Stochastic RSI has turned bearish. The MACD remains below its signal line, with the histogram staying in negative territory—together pointing toward a continued bearish bias.

Key Levels for Nifty 50

Resistance Levels (Pivot-based):

• 25,900
• 25,938
• 25,998

Support Levels (Pivot-based):

• 25,779
• 25,741
• 25,680

A sustained move above 25,900 may bring temporary relief, while a break below 25,779 could accelerate selling pressure.

Bank Nifty Technical Outlook

Current Level: 58,927

The Bank Nifty extended its weakness for the third consecutive session, forming another bearish candle with shadows on both ends. The index continues to follow a lower top–lower bottom structure, confirming a downtrend in the short term.

Price action remains below key short-term moving averages and between the middle and lower Bollinger Bands. Momentum indicators also reflect fatigue—RSI stands at 49.81, while both the Stochastic RSI and MACD remain below their respective reference lines, with the MACD histogram weakening further.

Key Levels for Bank Nifty

Resistance Levels (Pivot-based):

• 59,076
• 59,153
• 59,278

Support Levels (Pivot-based):

• 58,827
• 58,750
• 58,626

Fibonacci Resistance Levels:

• 59,467
• 60,895

Fibonacci Support Levels:

• 58,643
• 58,296

Any recovery attempt is likely to face selling pressure near resistance zones unless momentum improves significantly.

Nifty Options Data – Weekly Expiry

Call Options Activity

The 26,000 strike holds the highest Call open interest at 1.3 crore contracts, making it a strong resistance area. This is followed by:

• 25,900 strike – 1 crore contracts
• 26,300 strike – 81.55 lakh contracts

Fresh Call writing was concentrated at:

• 26,000 strike (+53.97 lakh contracts)
• 25,900 strike (+50.97 lakh contracts)
• 25,850 strike (+33.44 lakh contracts)

There was minimal Call unwinding across the 25,100–26,600 range, indicating traders are still holding bearish Call positions.

Nifty Put Options Activity

Put Options Activity

The 25,500 strike holds the maximum Put open interest at 64.56 lakh contracts, acting as a key support level. Other notable strikes include:

• 25,800 strike – 60.94 lakh contracts
• 25,300 strike – 47.85 lakh contracts

Maximum Put writing was observed at:

• 25,800 strike (+30.11 lakh contracts)
• 25,350 strike (+21.49 lakh contracts)
• 25,400 strike (+18.6 lakh contracts)

Put unwinding was highest at:

• 26,000 strike (−2.47 lakh contracts)
• 26,200 strike (−1.02 lakh contracts)
• 25,950 strike (−61,725 contracts)

This data suggests limited upside confidence near higher levels.

Bank Nifty Options Data – Monthly Expiry

Call Options Activity

The 59,500 strike carries the highest Call open interest at 18.46 lakh contracts, acting as a strong resistance. This is followed by:

• 60,000 strike – 17.83 lakh contracts
• 59,000 strike – 12 lakh contracts

Fresh Call writing was highest at:

• 59,000 strike (+2.25 lakh contracts)
• 59,100 strike (+1.32 lakh contracts)
• 59,200 strike (+95,025 contracts)

Maximum Call unwinding occurred at the 61,000 strike, indicating reduced bullish bets at higher levels.

Bank Nifty Put Options Activity

The 59,500 strike holds the highest Put open interest at 14.8 lakh contracts, followed by:

• 59,000 strike – 13.23 lakh contracts
• 58,000 strike – 11.1 lakh contracts

Put writing was strongest at:

• 58,000 strike (+81,375 contracts)
• 58,900 strike (+65,205 contracts)
• 58,800 strike (+52,080 contracts)

Notable Put unwinding was seen at:

• 59,500 strike (−2 lakh contracts)
• 60,000 strike (−68,495 contracts)
• 59,300 strike (−57,435 contracts)

This suggests cautious positioning near current levels.

Put-Call Ratio (PCR)

The Nifty Put-Call Ratio dropped to 0.77, down from 0.9 in the previous session. A declining PCR reflects increasing Call writing compared to Put writing, reinforcing the current bearish undertone.

Typically, PCR values above 1 indicate bullish sentiment, while readings drifting toward 0.5 highlight growing bearishness. The current level points to continued caution among traders.

India VIX

India VIX declined further by 2.24% to 9.84, marking its lowest closing level. The volatility index continues to trade well below key moving averages, suggesting market participants remain comfortable.

However, prolonged low volatility phases often precede sharp directional moves, making risk management crucial for traders in the coming sessions.

Conclusion

The overall setup for December 18, 2025, remains weak to bearish, supported by negative technical indicators, cautious options positioning, and a declining PCR. While low volatility offers short-term comfort, traders should stay disciplined and closely monitor key support levels, as a breakdown could trigger faster downside moves.

Disclosure & Disclaimer

Dhwani Patel (SEBI Registration No: INH200008608) is a SEBI-registered Research Analyst.
All views are for educational purposes only. This is not investment advice. Please consult your financial advisor before trading.