The Nifty50 index continues to face significant resistance at the 26,000-point level, with recent market data revealing persistent selling pressure from retail investors and foreign portfolio investors despite positive political developments.
Political Victory Fails to Break Market Resistance
Despite the ruling Bharatiya Janata Party-led National Democratic Alliance's landslide victory in the Bihar assembly polls, the benchmark Nifty50 index struggled to decisively break through the psychological 26,000-point barrier. The index closed at 25,910.05 points on Friday, November 17, 2025, after bouncing back from the day's low of 25,768 points.
Market participants had anticipated that the political certainty from the Bihar results would provide the necessary momentum to push the index beyond the crucial resistance level. However, data from both cash and derivatives markets suggests that achieving this breakthrough remains challenging.
Investor Divergence: DIIs Buy While Retail and FPIs Sell
A clear divergence emerged among different investor categories during Friday's trading session. Domestic institutional investors demonstrated strong buying interest, purchasing shares worth ₹8,461 crore, particularly during the final half-hour of trading as the NDA's victory margin widened.
In stark contrast, foreign portfolio investors and retail/high-net-worth individuals on the BSE sold a combined ₹6,197 crore worth of shares, according to provisional exchange data. This selling pressure occurred despite the positive political developments, indicating underlying caution at higher market levels.
Options Market Signals Strong Resistance at 26,000
The derivatives market provided compelling evidence of the stiff resistance at the 26,000 level. Retail and HNI investors net sold 41,925 index call option contracts on Friday, completely reversing their bullish stance from the previous day when they had purchased 49,531 call contracts.
Rajesh Palviya, head of research at Axis Securities, commented that "the call selling by retail/HNI is a reflection of the challenge the market has faced in decisively breaking the 26,000 level so far." The 26,000 call option expiring on November 18 had the highest open interest of 181,474 contracts, confirming this level as a significant resistance point.
Foreign portfolio investors also exhibited cautious behavior in the derivatives segment. While they purchased 5,035 additional index call options, they simultaneously increased their cumulative net short positions on index futures by 9,672 contracts to 169,619 contracts.
Historical Context and Market Outlook
The Nifty50 had previously touched a high of 26,104.2 points on October 23, 2023, marking its highest level in a year. However, subsequent selling pressure dragged the index down to 25,318.43 points by November 7, 2023, before the recent recovery fueled by the Bihar election results.
Market experts note that call writers have consistently dominated call buyers at the 26,000-mark in recent expiries. The 26,000 strike call options have repeatedly settled at near-zero values, with premiums collapsing as expiration approaches, reflecting the market's inability to sustain above this critical level.
S.K. Joshi, consultant at Khambatta Securities, explained that "this means even if there is a bump-up in the market on Monday, FPIs expect profit booking above 26,000 levels, which is why they have shorted more index futures than purchased call options."
Despite the current resistance, some analysts maintain a positive medium-term outlook. Rajesh Palviya believes the Nifty could still reach record highs by year-end, particularly if anticipated developments in Indo-US relations materialize positively.
The immediate support for the Nifty50 is identified at the 25,700 level, while overcoming the 26,000 barrier would require the index to close consistently above this mark for multiple trading sessions.
