After Roller-Coaster Activity, Nifty Ended 130 Points Higher

The Defence index gained the most, rallying over 3.5 percent.

Shrikant Chouhan, 

Head Equity Research, 

Kotak Securities:

Mumbai, May 21, 2025: Today, the benchmark indices experienced a volatile trading session. After a roller-coaster activity, the Nifty ended 130 points higher, while the Sensex was up by 410 points. Among sectors, almost all the major sectoral indices traded in positive territory, but the Defence index gained the most, rallying over 3.5 percent.

Technically, after an early morning intraday rally, the market faced resistance near 24,950/82,000 and corrected sharply. However, it eventually managed to close above 24,650/81,200, which is largely positive. We believe that the intraday market texture is non-directional, and as long as it is trading between 24,650 and 25,000, the range-bound texture is likely to continue. A breakout above 25,000/82,200 could push the market up to 25,100–25,150/82,500–82,700.

On the flip side, if the market drops below 24,650/81,200, sentiment could turn negative. Falling below this level, the correction wave is likely to accelerate. In such a scenario, the market could retest the levels of 24,500–24,450/80,700–80,500.

As per Gaurav Garg, Lemonn Markets Desk:

Summary:

• Benchmark indices recovered 0.5% on Wednesday snapping 3 days losing streak
• Pharma and Realty led the charge and gained more than 1%
• Broader Mid and Small cap indices also recovered to some extent and closed higher
• With no significant domestic triggers, market sentiment yesterday was influenced by global uncertainties.

Sectors:

• Realty & Pharma gained 1.7% and 1.25% respectively while Consumer Durables faced resistance and was down 0.5%

What Next?

• Nifty appears to be reverting to its short-term mean, with the 20-day EMA (around 24,400) acting as a key support. This level aligns with a bullish gap area and the 61.8% Fibonacci retracement of the rally from the May 9th swing low. Immediate support lies near 24,550.
• On the upside, the 25,000 level remains a significant resistance and may cap gains in the near term. Sectorally, broad weakness was seen, with the Nifty Midcap Select Index underperforming. The prices in this space are currently retesting previous breakout levels and the 200-day SMA, suggesting potential pressure ahead. Traders are advised to stay cautious and adopt a selective approach in the coming sessions.

Snapshot: