Trade Setup for Feb 10: Close watch on the Nifty’s behaviour around the 26,000 mark

Nifty rebounded sharply after early profit booking, closing near the day’s high above 25,800. Analysts see 26,000 as a key breakout level, with potential upside to 26,200, while immediate support is placed in the 25,650–25,700 zone.

Indian equity markets began the week on a strong footing, with benchmark indices posting solid gains on Monday amid supportive global cues and sustained domestic buying interest. The Nifty 50 opened with a sharp gap-up of nearly 200 points, signaling a decisive break from the recent consolidation phase that had kept traders cautious.

Although early profit booking led to some intraday volatility, the index demonstrated resilience. After slipping from its opening highs, the Nifty consolidated with a positive bias before staging a swift recovery of nearly 100 points from the day’s low. The rebound helped the index settle close to the session’s high, ending the day at 25,867, up 173 points. The close above the crucial 25,800 mark has strengthened bullish sentiment heading into Tuesday’s trade.

Market breadth remained robust, with broader indices outperforming frontline benchmarks. The Nifty Midcap 100 advanced 1.58%, while the Nifty Smallcap 100 surged 2.64%, reflecting strong participation beyond large-cap stocks. Sectorally, gains were broad-based. Media, Consumer Durables, and Realty led the rally, while all sectoral indices ended in positive territory.

Among index heavyweights, SBI, Shriram Finance, and Grasim were the top gainers on the Nifty. On the flip side, Max Healthcare, NTPC, and ITC witnessed selling pressure and closed among the laggards. Stock-specific action dominated trading activity. Kalyan Jewellers jumped over 15% after reporting strong third-quarter earnings, emerging as a standout midcap performer. Textile stocks, including Gokaldas Exports, gained up to 7% following positive developments related to the India–US interim trade framework.

In the telecom space, Vodafone Idea rose 4% after promoter Kumar Mangalam Birla acquired shares through the open market. Meanwhile, power finance majors PFC and REC ended lower after their boards approved a merger proposal, triggering cautious investor reaction.

Technical analysts suggest the market structure has turned constructive. According to market experts, the Nifty has reclaimed its 50-day moving average (DMA) near the 25,795 level, which now acts as immediate support. The recent breakout above the 25,700 resistance zone has further improved the technical outlook.

The 26,000 level is seen as a critical psychological and technical hurdle. Analysts believe that a decisive move above this mark could trigger fresh buying as well as short covering, potentially pushing the index toward the 26,200 zone in the near term. Beyond that, higher resistance is seen around 26,350.

On the downside, key support levels are placed in the 25,650–25,700 band, with a stronger support base around 25,450–25,500. As long as the index sustains above these zones, the broader trend is expected to remain positive.

With sentiment buoyant and earnings season nearing its final phase, traders are likely to focus on stock-specific opportunities while keeping a close watch on the Nifty’s behavior around the 26,000 mark in the upcoming session.