Stock Market Outlook: Nifty Hovers Near Resistance at 25,500; Sensex’s Bullish Candle Signals Potential Rally

The Indian stock market benchmark indices, Sensex and Nifty 50, are expected to open on a positive note on Tuesday, tracking firm global market cues and signals from the Gift Nifty, which was trading at around 25,184, a premium of nearly 56 points over the previous Nifty futures close.

On Monday, domestic equity markets closed with strong gains. The Sensex surged 442.61 points or 0.54% to end at 82,200.34, while the Nifty 50 climbed 122.30 points or 0.49% to settle at 25,090.70, closing above the key 25,000 mark for the first time.

Sensex, Nifty Prediction Today: Technical Outlook July 22

Analysts noted that the Sensex formed a bullish candle near the 50-day Simple Moving Average (SMA), suggesting that the recent pullback formation may continue in the near term.

The Nifty 50 also exhibited a bullish structure, forming a candle with a lower shadow on the daily timeframe-indicating strong buying interest at key support levels between 24,900 and 25,000. Moreover, higher-than-average traded volumes reinforced the strength of the bullish momentum.

Options Data: Key Resistance and Support Levels

Weekly options data shows the maximum Call open interest at the 25,500 strike (79.19 lakh contracts), which is expected to act as a critical resistance for the index. This was followed by significant Call OI at the 25,100 (75.21 lakh) and 25,200 (71.67 lakh) strikes.

Heavy Call writing was observed at the 25,600 strike, with an addition of 11.42 lakh contracts, followed by 25,500 and 25,700 strikes, which added 11.29 lakh and 9.39 lakh contracts respectively. Meanwhile, the maximum Call unwinding occurred at the 25,200 strike, shedding 13.88 lakh contracts.

On the Put side, the 25,000 strike held the maximum Put open interest (79.67 lakh contracts), establishing it as a strong support level for Nifty. It was followed by the 24,900 (74.4 lakh) and 25,100 (70.18 lakh) strikes.

Maximum Put writing was seen at the 25,100 strike with an addition of 50.06 lakh contracts, followed by 25,000 (33.06 lakh) and 24,900 (25.8 lakh). The maximum Put unwinding occurred at the 25,400 strike, with a reduction of 72,075 contracts.

Stock Market Sentiment: PCR and Volatility

The Put-Call Ratio (PCR)-an important market sentiment indicator-rose to 0.96 on July 21, up from 0.78 in the previous session. A rising PCR above 0.7 or near 1 generally signals increased bullish sentiment, indicating that more Put options are being sold than Calls. A PCR below 0.7, on the other hand, may suggest growing bearishness.

Meanwhile, India VIX, the volatility index, remained in a low range, falling 1.67% to 11.20. The subdued VIX supports market stability; however, analysts caution that volatility could return quickly in response to macro or geopolitical triggers.

With firm global cues, strong technical indicators, and continued institutional interest, analysts expect the Nifty 50 and Sensex to open higher and potentially extend their gains, provided the key support and resistance levels hold. Traders are advised to keep an eye on the 25,000-25,500 zone on the Nifty for signs of momentum in either direction.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.