Nifty 50 Outlook for May 19, 2025: Bullish Momentum Likely to Continue

 

Towards 25,200-25,300

The Nifty 50 is poised to maintain its bullish trajectory as markets open on May 19, 2025, after closing flat with moderate losses in the previous session at 25,020. Despite consolidation on May 16, the benchmark index continues to hold firmly above the crucial psychological level of 25,000, following a remarkable weekly gain of over 4 percent that saw it form a strong bullish candle with above-average volumes

Technical Positioning and Chart Patterns

The Nifty 50 is currently exhibiting strong technical patterns that support a continued upward movement. The index has sustained near the upper line of the Bollinger Bands despite recent consolidation, with an expansion in the bands signaling healthy momentum1. This technical setup typically suggests continuation of the prevailing trend. The higher highs-higher lows formation persists, with the index trading comfortably above all key moving averages (20-day, 50-day, and 200-day EMAs)

On the weekly timeframe, the Nifty has formed a long bullish candle that has retraced more than 61.80 percent of the decline from its lifetime high of 26,277 to the recent lows of 21,743 This significant retracement level is technically important as it signals a major shift in market sentiment and validates the strength of the current rally. The weekly Relative Strength Index (RSI) remains above its reference line, further confirming that momentum favors the bulls

Momentum Indicators

Technical indicators are in a healthy position, with the RSI (14) on daily charts moving above 65, reflecting strong positive momentum2. Additionally, the MACD has witnessed a bullish crossover and is trading in positive territory, suggesting potential for further upside in the short term. These momentum indicators collectively support the bullish outlook for the Nifty 50 in today's session.

Key Support and Resistance Levels

For May 19, the Nifty 50 faces immediate resistance at pivot points of 25,059, 25,087, and 25,1311. A sustained move above these levels could pave the way toward the 25,200-25,300 zone, which is being viewed as the immediate key resistance area by multiple analysts12. Breaking through this zone could potentially open the door to further gains toward 25,500-25,700, which represents a crucial hurdle before the index can attempt to reach its all-time high1.

Strong Support Base

On the downside, immediate support based on pivot points lies at 24,970, 24,942, and 24,897.  However, the more significant support zone is established at 24,850-24,800, which analysts believe must be defended to maintain the bullish bias.  Further support levels can be found at 24,700 and the sacrosanct support zone of 24,500-24,380, which coincides with a bullish gap that should provide strong cushioning in case of any sharp corrections2.

Options Data Analysis

The options data provides valuable insights into market expectations for the Nifty 50 in the short term. According to the weekly options data, the maximum Call open interest is concentrated at the 26,000 strike with 1.23 crore contracts, establishing it as a significant resistance level1. Following this are the 25,500 strike (82.59 lakh contracts) and the 25,000 strike (58.51 lakh contracts), indicating potential hurdles at these levels1.

Maximum Call writing was observed at the 25,500 strike, which saw an addition of 37.94 lakh contracts, suggesting that traders are positioning for limited upside beyond this level in the near term1. This significant build-up at 25,500 reinforces it as a crucial resistance zone to watch.

Put Options Support Structure

On the Put side, the maximum open interest is seen at the 25,000 strike with 64.54 lakh contracts, establishing it as a key support level1. The significant Put writing at this strike, which saw an addition of 24.56 lakh contracts, indicates strong confidence among market participants in defending this psychological level1. This options positioning suggests that market participants expect 25,000 to act as a floor for any downside moves, further strengthening the bullish outlook for today.

Expert Strategies and Recommendations

Market experts have provided several strategies based on their analysis of the current technical setup:

Osho Krishan from Angel One suggests that as long as 24,800 serves as an intermediate cushion, the bullish bias could push the Nifty toward the 25,200-25,300 zone in the short term2. His recommended strategy is to buy Nifty Futures on dips near 24,800-24,600 with a stop-loss at 24,400 and target profits near 25,3002.

Trading Approaches for May 19

Rajesh Palviya of Axis Securities notes that the Nifty is expected to trade within a broad range of 24,500-25,700 with a positive bias for the upcoming week.  He recommends buying Nifty Futures near 24,950 with a stop-loss at 24,800, targeting 25,250-25,350.  Alternatively, he suggests a Bull Call Spread strategy by buying one lot of 25,000 strike Call and selling one lot of 25,300 strike Call of May 22 expiry.

Riyank Arora from Mehta Equities takes a more aggressive approach, suggesting that any pullback toward 25,000 should be seen as a buying opportunity. His strategy involves buying Nifty May Futures at 25,080 with a trading stop-loss at 24,950 for upside targets of 25,250 and 25,300

Bank Nifty Correlation and Influence

The Bank Nifty's performance often influences the Nifty 50's direction, and it's currently trading in a consolidation phase near the 55,355 mark The banking index has formed a small bullish candle on the daily timeframe, signaling range-bound trading while facing resistance at 55,5001. A breakout above this level could provide additional momentum to the broader market, potentially helping the Nifty