Trade setup for December 30: Top 15 things to know before the opening bell

Nifty Trade setup for December 30

The Nifty 50 remained under pressure for the third straight session, falling four-tenths of a percent on December 29 ahead of the monthly F&O expiry due on December 30. The index broke below short-term moving averages and the midline of the Bollinger Bands, accompanied by bearish momentum indicators. The next support is placed at the 50 EMA (25,830), followed by 25,726 as a key support zone. If the index breaks below 25,726, the higher high–higher low formation could get negated and bears may take control. However, holding consistently above this level and bouncing back may raise the possibility of the index moving toward 26,300 and the continuation of the higher high–higher low structure, experts said.

Here are 15 data points we have collated to help you spot profitable trades:

1) Key Levels For The Nifty 50 (25,942)

Resistance based on pivot points: 26,061, 26,105, and 26,176

Support based on pivot points: 25,918, 25,874, and 25,803

Special Formation: The Nifty 50 formed a bearish candle on the daily timeframe and dropped below short-term moving averages, signalling bearish sentiment. Momentum indicators also remained weak, with the RSI falling below 50 to 49.06, while the Stochastic RSI sustained below its reference line. The MACD turned bearish, with the histogram falling below the zero line. All these indicators point to short-term weakness in the index.

2) Key Levels For The Bank Nifty (58,932)

Resistance based on pivot points: 59,087, 59,165, and 59,292

Support based on pivot points: 58,834, 58,756, and 58,630

Resistance based on Fibonacci retracement: 59,455, 60,875

Support based on Fibonacci retracement: 58,636, 58,287

Special Formation: The Bank Nifty formed a bearish candle with upper and lower shadows on the daily charts, indicating indecision between bulls and bears. The banking index sustained below short-term moving averages (10- and 20-day EMAs) and the midline of the Bollinger Bands, while momentum indicators remained bearish, with the RSI falling to 48.5. The MACD also sustained below its reference line with consistent weakening in the histogram. All these signals indicate short-term uncertainty and bearish bias in the Bank Nifty.

3) Nifty Call Options Data

According to the monthly options data, the maximum Call open interest was placed at the 26,100 strike (with 2.14 crore contracts). This level can act as a key resistance level for the Nifty in the short term. It was followed by the 26,000 strike (2.1 crore contracts) and 26,200 strike (1.93 crore contracts).

Maximum Call writing was observed at the 26,000 strike, which saw an addition of 99.07 lakh contracts, followed by the 25,950 and 26,100 strikes, which added 75.01 lakh and 59.85 lakh contracts, respectively. The maximum Call unwinding was seen at the 26,550 strike, which shed 24.13 lakh contracts, followed by the 26,400 and 26,700 strikes, which shed 19.24 lakh and 16.53 lakh contracts, respectively.

4) Nifty Put Options Data

On the Put side, the 25,900 strike holds the maximum Put open interest (with 1.04 crore contracts), which can act as a key support level for the Nifty in the short term. It was followed by the 26,000 strike (1.02 crore contracts) and the 25,800 strike (86.71 lakh contracts).

The maximum Put writing was placed at the 25,900 strike, which saw an addition of 33.21 lakh contracts, followed by the 25,850 and 25,950 strikes, which added 26.51 lakh and 15.46 lakh contracts, respectively. The maximum Put unwinding was seen at the 26,000 strike, which shed 47.15 lakh contracts, followed by the 26,050 and 26,100 strikes, which shed 43.16 lakh and 28.81 lakh contracts, respectively.

5) Bank Nifty Call Options Data

According to the monthly options data, the 59,000 strike holds the maximum Call open interest, with 21.22 lakh contracts. This can act as a key resistance level for the index in the short term. It was followed by the 59,500 strike (19.51 lakh contracts) and the 60,000 strike (18.39 lakh contracts).

Maximum Call writing was observed at the 59,000 strike (with the addition of 8.33 lakh contracts), followed by the 58,900 strike (4.09 lakh contracts) and 60,500 strike (2.13 lakh contracts). The maximum Call unwinding was seen at the 60,000 strike, which shed 2.46 lakh contracts, followed by the 59,500 and 59,300 strikes, which shed 1.47 lakh and 1.08 lakh contracts, respectively.

6) Bank Nifty Put Options Data

On the Put side, the maximum Put open interest was seen at the 59,000 strike (with 13.47 lakh contracts), which can act as a key level for the index. This was followed by the 58,500 strike (13.02 lakh contracts) and the 58,800 strike (10.24 lakh contracts).

The maximum Put writing was placed at the 58,800 strike (which added 6.23 lakh contracts), followed by the 58,700 strike (2.82 lakh contracts) and the 58,900 strike (2.71 lakh contracts). The maximum Put unwinding was seen at the 59,500 strike, which shed 2.06 lakh contracts, followed by the 59,100 and 57,500 strikes, which shed 2 lakh and 1.23 lakh contracts, respectively.

7) Funds Flow (Rs crore)

8) Put-Call Ratio

The Nifty Put-Call ratio (PCR), which indicates the mood of the market, fell further to 0.68 on December 29, compared to 0.76 in the previous session.

The increasing PCR, or being higher than 0.7 or surpassing 1, means traders are selling more Put options than Call options, which generally indicates the firming up of a bullish sentiment in the market. If the ratio falls below 0.7 or moves towards 0.5, then it indicates selling in Calls is higher than selling in Puts, reflecting a bearish mood in the market.

9) India VIX

The India VIX, also known as the fear gauge, bounced back to 9.72 after a three-day losing streak, rising 6.23 percent and signalling some discomfort for bulls. However, overall, the VIX remained below its key moving averages; hence, bulls may not be at major risk.

10) Long Build-up (17 Stocks)

A long build-up was seen in 17 stocks. An increase in open interest (OI) and price indicates a build-up of long positions.

11) Long Unwinding (76 Stocks)

76 stocks saw a decline in open interest (OI) along with a fall in price, indicating long unwinding.

12) Short Build-up (89 Stocks)

89 stocks saw an increase in OI along with a fall in price, indicating a build-up of short positions.

13) Short-Covering (30 Stocks)

30 stocks saw short-covering, meaning a decrease in OI, along with a price increase.

14) High Delivery Trades

Here are the stocks that saw a high share of delivery trades. A high share of delivery reflects investing (as opposed to trading) interest in a stock.

15) Stocks Under F&O Ban

Securities banned under the F&O segment include companies where derivative contracts cross 95 percent of the market-wide position limit.

Stocks added to F&O ban: Nil

Stocks retained in F&O ban: Sammaan Capital

Stocks removed from F&O ban: Nil