Market Pulse — Nifty: structurally strong, tactically cautious

On 20 November 2025, Indian markets once again displayed resilience despite mixed global cues. The intraday structure across the 5-minute and 1-hour charts remained decisively bullish. The market respected the short-term trade line that began on 19 November, repeatedly defended the 25,850–25,913 support band on lower timeframes, and closed near recent highs. Nvidia’s quarterly beat provided relief to global risk sentiment and temporarily eased concerns surrounding the AI sector. However, the larger structural risk remains the wave of unprofitable AI startups that depend on continuous funding. Domestically the market tone remains constructive; globally the environment remains fragile and highly sensitive to events.

Market Context — What Moved Price Today

• Global markets reacted positively to stronger-than-expected results from a major AI-chip manufacturer, easing fears of a broader technology-led shock.
• Indian markets absorbed early weakness and showed buying at previously tested short-term supports around 25,850–25,913. Multiple sessions without a clean breakdown below this area have turned it into a reliable demand zone.
• Volatility remained driven by events. Options positioning and volume spikes revealed aggressive institutional adjustments around major index levels, especially between 26,100–26,300 on the call side and 25,800–26,000 on the put side.

Technical Read — Structure, Levels and What to Watch

High-Level Bias: Daily and Weekly

• The trend remains bullish. Daily and weekly charts show higher highs and higher lows, with the index trading above important moving averages after recently breaking out of a multi-month consolidation.
• Weekly support sits around 25,400–25,600. A break below this region would indicate participation from broader sellers.

Intraday Structure: 1-Hour and 15-Minute

• The upward-sloping trade line from the 19 November low continues to guide short-term momentum. Sustaining above 26,100–26,120 keeps the bias positive.
• Immediate resistance lies at 26,200–26,300. A strong hourly close above 26,300 increases the likelihood of a move to record highs.
• Immediate support rests at 26,050–26,100, followed by 25,850–25,913, a zone that has been protected for several sessions.
• A daily close below 25,700–25,650 would weaken the overall structure and open the possibility of a deeper retracement towards 25,350–25,400.

5-Minute Micro Structure

• The market has been building a sequence of higher lows since 19 November. A clear 5-minute breakdown below the trade line or below 25,913 may trigger a quick intraday fade.
• Upward impulses have been supported by strong volume. Watch for volume divergence near resistance, which would suggest waning momentum.

Options and Positioning

• Options interest remains concentrated between 26,200–26,300 on calls and 25,900–26,000 on puts. This creates a zone where market-makers hedge aggressively, increasing intraday volatility.
• With expiry approaching, option decay accelerates. Significant moves can cause rapid repricing of options.
• Conservative strategies or defined-risk spreads are preferable to naked options during such conditions.

Macro and Fundamental Overlay

• Domestic fundamentals remain supportive. Recent data shows easing inflation, firm consumption trends, and steady policy direction. This backdrop has encouraged domestic investors to buy dips even when global markets show weakness.
• Foreign investor flows have been inconsistent, but domestic institutions and mutual funds have consistently provided depth and absorbed selling pressure. This dynamic keeps India relatively stable, though not immune to global risk-off phases.
• A major sector rotation risk remains in global technology. The rapid flow of capital into AI-linked assets has left valuations stretched. As large global companies report results, any slowdown in momentum can trigger broader de-risking.


Risk Map — What Could Destabilize the Rally

1. A slowdown in funding for unprofitable AI startups, leading to leveraged unwinding and reduced demand for hardware.


2. Weak US data or unexpected central bank shifts that affect global risk appetite.


3. Negative developments in India-US trade discussions or unfavourable geopolitical moves.


4. Domestic macro surprises or policy issues that disrupt the current liquidity environment.


Practical Trading Framework

Short-Term Intraday (5-Minute / 15-Minute)

• Long trades are favourable if price sustains above 26,100 with stops below 26,050. Upside targets lie around 26,300 and 26,400.
• Short trades become valid if price breaks below 25,913 on a 5-minute close, with targets near 25,850 and 25,700. Position sizing should remain controlled.

Swing Outlook (1 Day to 2 Weeks)

• Dips into 25,850–25,700 remain opportunities for staggered long entries, with stops below 25,600.
• Exposure to highly valued AI and tech names should be moderated. Prefer sectors reinforced by domestic fundamentals such as financials, cyclicals and consumption-linked names.

Options and Hedging

• Portfolio hedges using put options near major supports can help if volatility suddenly rises.
• Defined-risk bullish call spreads offer upside exposure without excessive premium outlay.


Psychology and Positioning

• The extended AI rally created concentration risks in global portfolios. When sentiment shifts, exits tend to be correlated across the same sector.
• Diversification and disciplined sector exposure limit this risk.
• Indian investors have taken a measured approach, using volatility as opportunity rather than reacting with fear.



Levels and News to Monitor

• Daily close above 26,300 indicates bullish continuation.
• Daily close below 25,650 signals broad structural weakness.
• Intraday: 26,100–26,150 as support; 26,200–26,300 as resistance.
• Flows: monitor daily FII/DII activity and mutual fund allocations.
• Domestic macro releases: inflation, consumption indicators, policy commentary.
• Global cues: US technology earnings, commentary from major AI-related firms, US bond yields, and developments in India-US trade discussions.



Conclusion

Indian markets remain structurally strong. Buyers continue to defend support zones, short-term trade lines remain intact, and price action reflects confidence rather than complacency. The global landscape, however, remains sensitive due to stretched AI valuations and key technology earnings. The prudent stance is to maintain a positive bias while managing risk carefully. Buying into well-defined support zones, trimming exposure to overheated segments, and hedging when necessary remain sensible strategies. Any deep correction driven by global factors would likely offer strong long-term opportunities in fundamentally sound, domestically aligned sectors.