Nifty 50 Pre- Open OI Data Analysis October-7
Post Market Analysis: October 4
On October 4, the Nifty 50 witnessed a significant sell-off, dropping by 1 percent and closing below its 50-day Exponential Moving Average (EMA) for the first time in four months. The broader market sentiment remained bearish, driven by concerns over global macroeconomic factors, rising oil prices, and geopolitical tensions in the Middle East. The index formed a bearish candlestick pattern on the daily chart, with a long upper shadow, indicating selling pressure at higher levels.
The Nifty 50 continued its downward trajectory, forming a lower high-lower low pattern for the fourth consecutive day. Key sectors such as Nifty Auto, Bank, FMCG, and Oil & Gas saw steep declines, with indices falling between 4-6 percent for the week. On the flip side, Nifty Metal outperformed, gaining marginally due to stimulus measures from China.
Technical Analysis (End of the Day – October 4)
- Nifty 50 closed at 25,015, down 1 percent for the day.
- Resistance Levels: The immediate resistance for Nifty 50 is seen at 25,300, followed by 25,476, and 25,674 based on pivot points.
- Support Levels: On the downside, the key support is at 24,750 if the index closes below 25,000. Further, support lies at 24,835 and 24,637.
- Indicators:
The 5-day EMA has fallen below the 10-day and 20-day EMAs, confirming a negative bias.
The Relative Strength Index (RSI) continues to show a downward trend with a bearish outlook on both daily and weekly timeframes.
India VIX, the volatility index, spiked to 14.13 (+7.27%), marking the second straight session of increased volatility. This surge has made the bulls cautious, as higher volatility levels indicate uncertainty and potential downside risks.
Market Sentiment for October 7
For the upcoming week, the market is likely to stay cautious. Global macroeconomic events such as the Reserve Bank of India’s (RBI) monetary policy meeting and US inflation data, along with geopolitical tensions in the Middle East, are expected to weigh on investor sentiment.
While a short-term bounce-back cannot be ruled out, market experts believe that the overall trend remains bearish. The levels around 24,750-25,000 will act as crucial supports, and any decisive fall below this range could lead to further downside. On the upside, the index faces a stiff resistance at 25,300-25,500.
Pre-Open Open Interest (OI) Data Analysis: October 7
- Put-Call Ratio (PCR): The PCR dropped to 0.69, the lowest since March 13, reflecting a bearish sentiment in the market. The drop suggests an increase in Call selling compared to Put selling, indicating traders are expecting further downside in the market.
- Call OI Analysis: Maximum open interest is seen at the 26,000 strike, which can act as a resistance level, followed by 25,500 and 25,400 strikes. Significant Call writing was observed at the 26,000 and 25,400 strikes, confirming resistance at higher levels.
- Put OI Analysis: On the Put side, the 24,000 strike holds the highest open interest, indicating key support. However, significant Put writing at the 24,800 and 24,500 strikes suggests market participants are cautious about further downside.
Resistance and Support Levels
- Resistance Levels: 25,300, 25,476, and 25,674
- Support Levels: 25,000, 24,750, 24,637
Conclusion and Recommendation
The overall market sentiment remains bearish, driven by negative global cues, geopolitical tensions, and rising volatility. While a short-term bounce-back is possible, the broader trend suggests a “sell on rally” strategy. Traders should remain cautious, with key support at 24,750 and resistance at 25,300-25,500. Any decisive break below 24,750 could lead to further downside towards 24,500.
Disclaimer
The views expressed in this analysis are based on technical indicators and market sentiment as of October 4. Market conditions can change rapidly, and past performance is not indicative of future results. Investors are advised to conduct their own research or consult with a financial advisor before making any investment decisions.
Nifty 50 Pre- Open OI Data Analysis October 8
Nifty 50 Post-Market Review (October 7)
The Nifty 50 index continued its downward trajectory for the sixth consecutive session, closing with a decline of nearly 1% on October 7. The market sentiment remained bearish, with the index approaching its September low of 24,750—a crucial support level. Despite efforts to stabilize, above-average volumes and negative breadth signaled that the bears were in firm control, with 80% of the stocks in the red. The bearish momentum was further confirmed by technical indicators such as the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD), both maintaining a negative bias.
The Nifty formed a long bearish candlestick pattern on the daily charts, reinforcing the downtrend. If the index manages to hold the 24,750 level on a closing basis, there is potential for a short-term recovery toward the 25,000-25,100 zone. However, a decisive break below this support could lead to a further decline to the 24,500 level.
Technical Setup at the End of the Day (October 7)
Resistance Levels: Based on pivot points, the immediate resistances for the Nifty 50 stand at 25,049, 25,155, and 25,326. The upper range of resistance at 25,326 could be a strong barrier in the short term, especially if volumes remain low.
Support Levels: The index finds support at 24,706, 24,600, and 24,429. The 24,706 level is particularly critical, with a break below this point likely to trigger further selling pressure.
Candlestick Pattern: The formation of lower tops and lower bottoms for five consecutive sessions indicates strong bearish sentiment.
Momentum Indicators:
RSI: Signaling weakness as it remains in a downward trajectory.
MACD: Continues to show a negative crossover on both the daily and weekly charts.
Pre-Open Market Sentiments (October 8)
With the market facing downward pressure, pre-open sentiments on October 8 are expected to remain cautious. Traders will closely watch the 24,750 level, as any breach of this support could exacerbate selling. Global cues, rising volatility, and domestic factors will also play a role in shaping the early market movement.
Key resistance for the day will likely remain near the 25,000-25,100 zone, with support at 24,706 and 24,600. Any signs of resilience at these support levels could attract some buying, though sentiment remains bearish in the short term.
Pre-Open OI Data Analysis (October 8)
According to the weekly options data, the following trends are observed:
Maximum Open Interest (OI): On the Call side, the maximum OI was seen at the 26,000 strike (1.01 crore contracts), followed by the 25,500 strike (68.57 lakh contracts). These levels are likely to act as key resistance in the coming sessions.
Maximum Call Writing: The 25,000 strike saw an addition of 27.33 lakh contracts, suggesting strong resistance at this level.
Maximum Put OI: The highest open interest was at the 24,000 strike (55.06 lakh contracts), indicating significant support at this level.
Maximum Put Writing: The 24,000 strike added 9.02 lakh contracts, further reinforcing the support.
The Nifty Put-Call Ratio (PCR) dropped to 0.67, indicating a bearish sentiment. A PCR below 0.7 reflects increased selling of Call options, suggesting bearish market expectations.
Resistance and Support Levels
Resistance: 25,049 (Immediate), 25,155 (Near-term), 25,326 (Strong)
Support: 24,706 (Immediate), 24,600 (Near-term), 24,429 (Critical)
Conclusion and Recommendation
The Nifty 50 is currently at a critical juncture. Holding the 24,750 support level will be key to any potential recovery in the short term, with resistance looming near the 25,000 mark. However, a decisive break below this level could open the door for further declines towards the 24,500 level or even lower.
Traders are advised to remain cautious and closely monitor key support and resistance levels. A breakout or breakdown of the current range could dictate the market’s direction for the coming days. With volatility on the rise, it is recommended to avoid aggressive trades and consider hedging positions to mitigate risk.
Disclaimer
This report is for informational purposes only and does not constitute financial advice. Market conditions can change rapidly, and it is advised that readers conduct their own research or consult a financial advisor before making any investment decisions. The views expressed in this report are based on technical analysis and should not be construed as a guarantee of future market performance.
Nifty 50 Pre-Open OI Data Analysis
Post – Market Analysis for October 8:
The Nifty 50 index saw a positive session on October 8, snapping a six-day losing streak and closing above the critical psychological level of 25,000. The index rose nearly 1%, after suffering a significant 5.6% decline from its all-time high. This bounce, albeit modest, was supported by a bullish candlestick pattern on the daily chart, signaling potential consolidation in the near term.
However, despite the positive close, the index continues to form lower highs, indicating caution. Consolidation is expected to persist unless the index manages to close decisively above the 25,500 mark, which has emerged as a key resistance level. On the downside, strong support can be seen between 24,750 and 24,700, offering a crucial safety net for the bulls.
Technical Setup at the End of the Day:
The technical indicators reflect a mixed sentiment:
- Candlestick Pattern: The index formed an Inside Bar pattern on the daily chart, hinting at consolidation. Sustaining above the upward-sloping support trendline, connected to the lows from June 24, August 5, and October 7, is a positive sign.
- Momentum Indicators: The Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) showed a positive crossover on the hourly charts, suggesting bullish momentum in the short term.
- Moving Averages: The Nifty 50 is trading below the 50-day Exponential Moving Average (EMA), while the 10-day EMA has fallen below the 20-day EMA, a signal of continued pressure on the upside.
Market Sentiment at the End of the Day:
Market sentiment showed cautious optimism, with volatility easing after a four-day spike. The India VIX, often called the fear index, dropped by 3.27% to 14.59, down from 15.08. Despite the decline, volatility remains above the 14.5 level, keeping traders alert to sudden shifts.
The Put-Call Ratio (PCR), a key sentiment indicator, increased from 0.67 to 0.74, which reflects more Put options being sold than Call options. A rising PCR, particularly above 0.7, generally indicates strengthening bullish sentiment.
Pre-Open OI Data Analysis:
- Maximum Open Interest (OI): On the Call side, the 26,000 strike holds the highest open interest, with 97.94 lakh contracts, establishing it as a significant resistance level in the short term. It is followed by the 25,500 strike (73.92 lakh contracts) and the 25,000 strike (55.84 lakh contracts).
- Call Writing: Substantial Call writing was observed at the 25,000 strike (9.75 lakh contracts), suggesting strong resistance at this level. The 25,200 and 25,100 strikes also saw significant Call writing.
- Put Open Interest: On the Put side, the 24,000 strike holds the maximum open interest with 70.91 lakh contracts, acting as strong support. This is followed by the 25,000 and 24,500 strikes.
- Put Writing: Maximum Put writing was at the 25,000 strike, with an addition of 19.68 lakh contracts, suggesting that traders are viewing this level as a robust support zone.
Resistance and Support Levels:
Resistance Levels:
- 25,500 (Key resistance, strong close required above this level for bullish momentum)
- 25,200-25,300 (Immediate resistance on the higher side)
- 26,000 (Major resistance based on options data)
Support Levels:
- 24,750-24,700 (Key support zone)
- 24,000 (Major support based on options data)
- 24,800 (Immediate support below 25,000)
Conclusion and Recommendation:
The Nifty 50’s recovery above 25,000 is encouraging, yet the market’s inability to break above 25,500 signifies that consolidation is likely in the coming sessions. The presence of a bullish candlestick and positive momentum indicators suggests that a break above 25,500 could lead to further upside, with 25,800 and 26,000 as the next targets.
However, traders should remain cautious due to the mixed technical signals, including the bearish moving average crossover and ongoing high volatility levels. For now, the 25,000 mark is critical; a sustained close below this level could open the door for a retest of 24,750 or even 24,500.
Recommendation: Traders should adopt a cautious approach, with a focus on immediate support and resistance zones. Positions should be adjusted according to the market’s ability to hold above 25,000 and its movement toward or away from the key 25,500 resistance level.
Disclaimer:
This report is for informational purposes only and is not intended as financial advice. Trading in financial markets involves risk, and past performance is not indicative of future results. Always consult a professional financial advisor before making any investment decisions.
Nifty 50 Outlook for October 10, 2024
Post Market Analysis (October 9, 2024)
On October 9, the Nifty 50 faced selling pressure at higher levels, ultimately failing to sustain its intraday gains and closing just below the 25,000 mark. The index recorded moderate losses and exhibited consolidation, breaking a six-day trend of lower highs on the daily charts. However, the weekly charts continued to display lower tops and bottoms, signaling ongoing downward pressure. The market’s inability to hold its gains reflects cautious sentiments among traders.
A small bearish candlestick pattern formed on the daily timeframe, with a long upper shadow indicating selling pressure at higher levels. Although the index made a higher high-higher low formation, the bearish candlestick highlights resistance. The Nifty 50 sustained above an upward-sloping trendline but continued to trade below the 50-day EMA (Exponential Moving Average), suggesting that the broader trend is still bearish unless the index breaks above this key technical level.
Technical Setup at Market Close
Resistance Levels: Based on pivot points, immediate resistance stands at 25,164, followed by 25,232 and 25,341. The maximum open interest at the 25,500 strike further reinforces this level as a significant barrier, while the 26,000 strike also poses resistance in the short term.
Support Levels: Immediate support is seen at 24,945, followed by 24,878 and 24,768, based on pivot points. Further, the 24,000 strike, holding the highest open interest on the Put side, is a key support level, indicating that traders expect strong support at this zone.
Market Sentiments
The Nifty 50 continues to trade in a range-bound, consolidating mode, with selling pressure at higher levels. The Put-Call Ratio (PCR) dropped slightly to 0.72 from 0.74 in the previous session, suggesting a cautious market sentiment leaning toward bearishness. A PCR lower than 0.7 usually signals heightened Call selling, indicating negative sentiment. However, the index’s ability to sustain above the 25,300–25,350 zone could shift momentum in favor of the bulls.
Volatility, as measured by the India VIX, decreased by 3.19 percent, closing at 14.12. Despite the decline, volatility remains elevated above the 14 mark, signaling ongoing caution in the market. Sustained levels above 14 typically indicate that traders remain wary of sudden swings, and this warrants a defensive strategy.
Pre-Open OI Data Analysis
- Call Side: Maximum open interest on the Call side was observed at the 25,500 strike (1.19 crore contracts), signaling strong resistance at this level. Significant Call writing was also noted at the 25,300 and 25,200 strikes, with 32.98 lakh and 32.22 lakh contracts added, respectively. This reinforces the notion that upward movement beyond 25,300 will face significant resistance in the short term.
- Put Side: On the Put side, the 24,000 strike holds the maximum open interest with 78.32 lakh contracts, indicating strong support at this level. Put writing at the 24,400, 24,800, and 24,500 strikes adds further support, as these levels witnessed significant contract additions.
Conclusion and Recommendation
The Nifty 50 continues to face resistance at higher levels, with strong resistance zones at 25,300-25,500. The technical setup indicates that any bullish momentum will only materialize if the index sustains above this zone. Until then, the market is likely to remain range-bound with a slight bearish bias, with key support at 24,700 and lower levels around 24,000 providing a cushion for any significant downside movement.
Volatility remains a key factor to watch, and traders are advised to remain cautious as long as the India VIX sustains above the 14 mark. The 50-day EMA remains a critical level to monitor for any sustained upward breakout. Until the market breaks out of its current consolidation phase, traders should adopt a cautious approach with a focus on short-term strategies, avoiding aggressive positions.
Disclaimer
This report is based on technical analysis and market data available at the time of writing. All trading involves risk, and past performance is not indicative of future results. Investors should consider their own risk tolerance and consult with a financial advisor before making any investment decisions.
Nifty 50 Pre-Open OI Data Analysis October 11
Post-Market Analysis (October 10)
The Nifty 50 remained rangebound throughout October 10, finishing flat with a slight positive bias. The market mirrored mixed trends in global peers, with falling volatility acting as a supportive factor. The index closed below the critical 50-day Exponential Moving Average (EMA), reflecting cautious optimism, yet it held above the upward-sloping support trendline, which indicates potential downside protection in the coming sessions.
Technical Setup of the Nifty 50
- Resistance Levels: Based on pivot points, the immediate resistance levels for the Nifty 50 stand at 25,096, 25,133, and 25,192. The key resistance hurdle is expected at 25,300, above which the index could aim for 25,500.
- Support Levels: On the downside, 24,900 is the immediate support level, followed by a more critical zone around 24,700. These levels are vital as they may trigger further downside action if breached.
- Candlestick Formation: The formation of a small bearish candlestick with a minor upper shadow indicates a rangebound market. However, sustaining below the 50-day EMA suggests a cautious sentiment for any upward momentum. The support trendline remains key for mitigating potential downside risks.
- Volatility: India VIX, the volatility index, fell by 4.44% to 13.50, signaling reduced market uncertainty. A further drop in volatility could offer support for bullish momentum.
Market Sentiment for October 11
With the Nifty Put-Call ratio (PCR) rising to 0.93 from 0.72, there is an indication of increased bullish sentiment as traders write more Put options. However, a ratio nearing 1 may also reflect caution, hinting at a consolidation phase. The reduced volatility, now below the 14 mark, further supports a stable to mildly bullish outlook for the upcoming session.
Pre-Open OI Data Analysis
The weekly options data showed that the 25,000 strike holds the maximum Open Interest (OI) at 2.7 crore contracts, acting as a key short-term level. This is followed by the 25,100 and 25,500 strikes with significant OI. On the Call side, the 25,000 strike saw the most Call writing, adding 2.19 crore contracts, signaling that this level could act as strong resistance.
On the Put side, the 25,000 strike also holds the highest OI at 2.44 crore contracts, indicating a strong support zone. The Put writing at this strike suggests that market participants expect the index to remain above this level in the near term.
Resistance and Support Levels for October 11
- Key Resistance: 25,300 (major hurdle), followed by 25,500.
- Key Support: 24,900 (immediate support), followed by 24,700 (crucial support for the trend).
Conclusion and Recommendation
Given the mixed global cues and falling volatility, the Nifty 50 is expected to continue its consolidation within the range of 24,900 and 25,300. A breakout above 25,300 could trigger a rally toward 25,500, while a breakdown below 24,900 may resume a bearish trend. The increasing Put-Call ratio and declining volatility suggest a cautiously bullish outlook, but traders should remain alert to support levels.
For the upcoming sessions, it is advisable to keep a close watch on the 25,000 level, as it is the critical pivot point for the Nifty’s short-term direction. A breach of key resistance or support levels may lead to significant market moves.
Disclaimer
This report is for informational purposes only. The views expressed herein are based on market analysis and should not be considered as financial advice. Investors should perform their own research or consult a professional advisor before making any investment decisions. The author is not responsible for any losses that may arise from trading decisions based on this report.