Trade Setup for Tuesday: Top 10 things you should know before Opening Bell
Here are the top ten data points to help you spot profitable trade.
The Nifty closed above its crucial psychological level of 9,650 on Monday and also above its short term moving averages such as 5-days exponential moving average (DEMA), 10-DEMA, and 20-DEMA which is a bullish sign.
There was no particular pattern which the index formed but it made a bullish candle on the daily candlestick charts as the closing level was higher than the opening level. The index finally closed 69.50 points higher at 9,657.
The big move could also be a result of short covering which propped the index towards 9,700. This was evident from the advance-decline ratio which sits at 99 issues advancing compared with 112 declining.
The momentum is likely to strengthen further once it crosses Nifty record high placed at 9,709.30. Monday’s move negated the formation of lower top–lower bottom and given the upside breakout from its falling channel on the hourly scale.
We have collated ten data points to help you spot profitable trade:
Key Support & Resistance Level for Nifty:
The Nifty closed nearly 70 points higher or 0.72 percent at 9,657.55. According to Pivot charts, the key support level for Nifty is placed at 9,623.87, followed by 9,590. If the index starts to move higher then key resistance levels to watch out are 9,682, followed by 9,706.
Nifty Bank closed 239 points higher or 1.02 percent at 23,742 on Monday. It hit a record high of 23,806.65. Important Pivot level which will act as crucial support for the index is placed at 23,583 followed by 23,423. On the upside, the key resistance level is 23,584 followed by 23,965.
Call Options Data:
Maximum Call open interest (OI) of 65 lakh contracts stands at strike price 9,700 which will act as a crucial resistance level for the index in June series, followed by 9,800 which now holds 46 lakh contracts in open interest and 9,600 which has accumulated 36 lakh contracts in OI.
There was hardly any Call Writing but Call unwinding was seen at strike prices 9,600 (17.1 lakh contracts shed), 9,700 (10.2 lakh contracts shed), 9,800 (3.3 lakh contracts shed), 9900 (nearly 1 lakh contracts shed) and 9,500 (2.3 lakh contracts shed).
Put Options Data:
Maximum Put OI of 63 lakh contracts was seen at strike price 9,500 which will act as a crucial base for the index in June series followed by 9,600 which has accumulated 62 lakh contracts in open interest, and 9,400 which now holds 50 lakh contracts in open interest.
Put Writing was seen at strike prices 9,600 (4.2 lakh contracts added), 9,700 (10 lakh contracts added), 9,800 (1.08 lakh contracts added), and 9300 (1.6 lakh contracts added).
Put unwinding was seen at strike prices 9,400 (1.6 lakh contracts shed), 9,500 (7.2 lakh contracts shed), 10,000 (0.48 lakh contracts shed), and 9,400 (1.6 lakh contracts shed).
FII & DII Data:
Foreign Institutional Investors (FIIs) sold shares worth Rs 250 crore compared to Domestic Institutional Investors who bought shares worth Rs 530 crore in Indian equity market.
Stocks with high delivery percentage:
High delivery percentage suggests that investors are accepting the delivery of the stock which means that investors are bullish on the stock.
74 stocks saw Long Buildup:
45 stocks saw short covering:
A decrease in open interest along with an increase in price mostly indicates short covering.
22 stocks saw Long Unwinding:
Long Unwinding happens when there is a decrease in OI as well as in price.
67 stocks saw Short Buildup:
An increase in open interest along with a decrease in price mostly indicates short positions being built up.