Trade setup for July 25: Top 15 things to know before the opening bells

Nifty Trade setup for July 25

The Nifty 50 shed its previous day's gains and finished 0.63 percent lower on July 24, the weekly F&O expiry session. The bearish pattern formation and failure to hold above short-term moving averages signaled a possible continuation of consolidation in the upcoming sessions. According to experts, the Nifty needs to surpass and sustain above the 25,250 hurdle for an upmove toward 25,350, and then 25,550. However, below this level, the consolidation may continue, with immediate support in the 25,000–24,900 zone.

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

1) Key Levels For The Nifty 50 (25,062)

Resistance based on pivot points: 25,196, 25,250, and 25,337

Support based on pivot points: 25,022, 24,968, and 24,882

Special Formation: The Nifty 50 formed a Bearish Engulfing candlestick pattern on the daily timeframe, accompanied by above-average volumes. The index dropped below short-term moving averages (10-day and 20-day EMAs) and has sustained in the lower band of the Bollinger Bands for the past 10 sessions. The RSI failed to give a bullish crossover, while the Stochastic RSI maintained a positive crossover, and the MACD histogram showed consistent improvement. This indicates a mixed setup, with a bias toward continued consolidation unless strong upward momentum emerges.

2) Key Levels For The Bank Nifty (57,066)

Resistance based on pivot points: 57,256, 57,366, and 57,544

Support based on pivot points: 56,900, 56,790, and 56,612

Resistance based on Fibonacci retracement: 57,331, 57,630

Support based on Fibonacci retracement: 56,769, 56,639

Special Formation: The Bank Nifty performed better than the benchmark Nifty 50, falling only 0.25 percent. The index sustained above the midline of the Bollinger Bands and short-term moving averages, although it formed a bearish candle with a lower shadow on the daily chart, accompanied by above-average volumes. The RSI at 54.69 showed a negative crossover, while the Stochastic RSI maintained a bullish crossover, and the MACD histogram showed further improvement. This indicates a more resilient structure in Bank Nifty compared to Nifty 50, with possible consolidation or mild upward bias.

3) Nifty Call Options Data

According to the monthly options data, the maximum Call open interest was seen at the 25,500 strike (with 91.36 lakh contracts). This level can act as a key resistance for the Nifty in the short term. It was followed by the 25,200 strike (80.99 lakh contracts), and the 25,400 strike (56.6 lakh contracts).

Maximum Call writing was observed at the 25,200 strike, which saw an addition of 44.52 lakh contracts, followed by the 25,100 and 25,300 strikes, which added 32.43 lakh and 29.4 lakh contracts, respectively. There was hardly any Call unwinding seen in the 24,300-25,800 strike band.

4) Nifty Put Options Data

On the Put side, the 25,000 strike holds the maximum Put open interest (with 76.71 lakh contracts), which can act as a key support level for the Nifty. It was followed by the 24,500 strike (52.57 lakh contracts) and the 24,800 strike (47.97 lakh contracts).

The maximum Put writing was placed at the 24,800 strike, which saw an addition of 20.89 lakh contracts, followed by the 24,600 and 24,500 strikes, which added 8.96 lakh and 7.71 lakh contracts, respectively. The maximum Put unwinding was seen at the 25,250 strike, which shed 2.46 lakh contracts, followed by the 24,650 and 25,300 strikes, which shed 53,325 and 24,225 contracts, respectively.

5) Bank Nifty Call Options Data

According to the monthly options data, the 57,000 strike holds the maximum Call open interest, with 15.62 lakh contracts. This can act as a key level for the index in the short term. It was followed by the 59,000 strike (13.05 lakh contracts) and the 57,500 strike (12.39 lakh contracts).

Maximum Call writing was visible at the 58,300 strike (with the addition of 3.58 lakh contracts), followed by the 57,100 strike (1.41 lakh contracts), and the 59,000 strike (97,755 contracts). The maximum Call unwinding was seen at the 57,900 strike, which shed 52,815 contracts, followed by the 57,700 and 58,400 strikes, which shed 39,480 and 28,595 contracts, respectively.

6) Bank Nifty Put Options Data

On the Put side, the maximum Put open interest was placed at the 57,000 strike (with 13.49 lakh contracts), which can act as a key support level for the index. This was followed by the 56,000 strike (13.47 lakh contracts) and the 56,500 strike (8.3 lakh contracts).

The maximum Put writing was observed at the 55,500 strike (which added 1.25 lakh contracts), followed by the 57,100 strike (61,845 contracts) and the 55,700 strike (26,915 contracts). The maximum Put unwinding was seen at the 57,000 strike, which shed 1.79 lakh contracts, followed by the 56,900 and 57,200 strikes, which shed 1.25 lakh and 1.02 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, dropped to 0.9 on July 24, compared to 1.14 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 fear gauge, India VIX, rebounded to the 10.72 zone, up 1.97 percent, after falling for the previous three consecutive sessions. However, it remained in the lower zone, indicating low volatility in the near term and providing stable conditions. At the same time, the low VIX also alerts for the possibility of a major move on either side.

10) Long Build-up (19 Stocks)

A long build-up was seen in 19 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 (84 Stocks)

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

13) Short-Covering (47 Stocks)

47 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: Indian Energy Exchange, RBL Bank

Stocks removed from F&O ban: Bandhan Bank