Trade Setup for June 12: Nifty looks for seventh day of gains but 25,200 remains a barrier

The benchmark Nifty 50 index held above the 25,100 mark, gaining for the sixth straight session on Wednesday. After a positive start, the index moved higher during the early to mid-session. However, it failed to sustain above the crucial 25,200 level and slipped from the highs in the latter half of the day.

An attempt to decisively break out past the 25,200 resistance was unsuccessful, as the Nifty dropped over 100 points from its intraday high of 25,222 after 1 PM. The index ultimately ended the day with a minor gain of 37 points at 25,141.

HCL Technologies, Infosys and Tech Mahindra were amongst the major gainers on the Nifty. Conversely, Shriram finance, Power Grid, and Bharat Electronics faced selling pressure and ended as major losers.

In a change from recent trends, both the Nifty Midcap and Smallcap indices broke their winning streak today. The Nifty Midcap 100 Index fell by 0.49%, while the Nifty Smallcap 100 Index went down by 0.53%.

Sectorally, Oil & Gas, IT, and Pharma were the major gainers, demonstrating strength even in a consolidating market. However, Nifty PSU Banks, FMCG, and Metal sectors ended the day in the red.

IT stocks lent support to the market, while financials dragged. The Nifty IT index rose 1%.

Oil & gas stocks saw broad-based gains, with the sectoral index rising 1.4%. This comes after the US oil body Energy Information Administration (EIA) said it expects Brent crude to fall to $59 by 2026. OMC stocks rose 3-4%.

IEX shares were the top midcap loser, sliding 8% on reports related to market coupling. Sources told CNBC-TV18 that Power Minister Manohar Lal may conduct consultations with stakeholders on the issue to apprise them about the benefits of market coupling.

Shares of the Bombay Stock Exchange (BSE) Ltd. fell as much as 5% after the stock was added to the stage-1 of the Additional Surveillance Measures (ASM) framework. As a result, trading on the stock will now attract a 100% margin.

According to Nagaraj Shetti of HDFC Securities, the near-term uptrend of the Nifty remains intact and the market is currently facing stiff resistance around 25,200 levels. "A sustainable move only above 25,200 is likely to pull Nifty towards another hurdle of 25,600 in a quick period of time. Immediate support is placed at 25,000 levels."

LKP Securities' Rupak De told investors that any dip should be viewed as a buying opportunity. "Crucial support is placed at 24,850. As long as the index holds above this level, the trend is likely to remain positive, with potential to move towards 25,350 in the short term."