Trade setup for March 12: Top 15 things to know before the opening bell

Nifty Trade Setup

The Nifty 50 made a healthy comeback with above-average volumes, recouping 183 points from the day's low and closing 38 points higher on March 11. It found support at the 22,300 zone, although the market breadth remained weak. If the index manages to extend its gains in the upcoming sessions, the 22,700 level is likely to act as a key hurdle. A decisive close above it could open doors to 23,000. Until then, consolidation may continue with support at the 22,300-22,250 levels, according to experts.

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

1) Key Levels For The Nifty 50 (22,498)

Resistance based on pivot points: 22,524, 22,573, and 22,652

Support based on pivot points: 22,366, 22,317, and 22,238

Special Formation: The Nifty 50 formed a bullish candlestick pattern on the daily timeframe with above-average volumes, closing above the 5 and 10-day EMAs. A strong uptrend is possible only above the 20-day EMA, which coincides with the midline of the Bollinger bands (22,650). The momentum indicators showed an uptick: the RSI (Relative Strength Index) stands at 40.81, indicating a slight improvement but still in the lower band. The MACD (Moving Average Convergence Divergence) reported a positive crossover but remains below the zero line.

2) Key Levels For The Bank Nifty (47,854)

Resistance based on pivot points: 47,987, 48,064, and 48,188

Support based on pivot points: 47,737, 47,660, and 47,536

Resistance based on Fibonacci retracement: 49,308, 50,288

Support based on Fibonacci retracement: 47,872, 46,078

Special Formation: The Bank Nifty performed poorly on Tuesday, falling 363 points to close near the lower end of the Bollinger bands and forming a Doji candlestick pattern on the daily charts with above-average volumes. This indicates indecision among bulls and bears. The bearish sentiment persisted as the index traded below all key moving averages, had a strong gap-down opening, and reached a fresh 9-month low.

3) Nifty Call Options Data

According to the weekly options data, the 23,000 strike holds the maximum Call open interest (with 1.5 crore contracts). This level can act as a key resistance for the Nifty in the short term. It was followed by the 22,900 strike (1.08 crore contracts) and the 22,700 strike (95.77 lakh contracts).

Maximum Call writing was observed at the 22,900 strike, which saw an addition of 41.11 lakh contracts, followed by the 23,000 and 23,300 strikes, which added 24.73 lakh and 21.15 lakh contracts, respectively. The maximum Call unwinding was seen at the 23,500 strike, which shed 39.56 lakh contracts, followed by the 23,100 and 23,400 strikes, which shed 27.22 lakh and 16.52 lakh contracts, respectively.

4) Nifty Put Options Data

On the Put side, the maximum Put open interest was seen at the 22,200 strike (with 1.1 crore contracts), which can act as a key support level for the Nifty. It was followed by the 22,000 strike (1.03 crore contracts) and the 22,400 strike (84.79 lakh contracts).

The maximum Put writing was placed at the 22,200 strike, which saw an addition of 48.15 lakh contracts, followed by the 22,400 and 22,350 strikes, which added 32.28 lakh and 25.33 lakh contracts, respectively. The maximum Put unwinding was seen at the 22,600 strike, which shed 2.29 lakh contracts, followed by the 22,800 and 23,000 strikes, which shed 2.22 lakh and 1.53 lakh contracts, respectively.

5) Bank Nifty Call Options Data

According to the monthly options data, the maximum Call open interest was seen at the 49,000 strike, with 17.01 lakh contracts. This can act as a key resistance level for the index in the short term. It was followed by the 50,000 strike (13.51 lakh contracts) and the 48,500 strike (12.58 lakh contracts).

Maximum Call writing was visible at the 48,000 strike (with the addition of 4.37 lakh contracts), followed by the 47,900 strike (2.07 lakh contracts) and the 49,500 strike (1.61 lakh contracts). The maximum Call unwinding was seen at the 50,000 strike, which shed 1.32 lakh contracts, followed by the 48,600 and 48,400 strikes, which shed 32,760 and 25,290 contracts, respectively.

6) Bank Nifty Put Options Data

On the Put side, the 48,000 strike holds the maximum Put open interest (with 14.61 lakh contracts), which can act as a key level for the index. This was followed by the 46,000 strike (13.81 lakh contracts) and the 47,000 strike (11.26 lakh contracts).

The maximum Put writing was observed at the 47,800 strike (which added 2.59 lakh contracts), followed by the 46,000 strike (1.64 lakh contracts) and the 48,000 strike (1.39 lakh contracts). The maximum Put unwinding was seen at the 48,500 strike, which shed 1.26 lakh contracts, followed by the 48,400 and 48,300 strikes which shed 1.22 lakh and 80,190 contracts, respectively.

7) Funds Flow (Rs crore)

8) Put-Call Ratio

The Nifty Put-Call ratio (PCR), which indicates the mood of the market, jumped to 1.09 on March 11, against 0.91 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, the fear index, continued its upward trend for another session, rising 0.63 percent to 14.07 levels. If the index sustains above the 14 mark, bulls will need to exercise caution.

10) Long Build-up (54 Stocks)

A long build-up was seen in 54 stocks. An increase in open interest (OI) and price indicates a build-up of long positions.

11) Long Unwinding (22 Stocks)

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

12) Short Build-up (45 Stocks)

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

13) Short-Covering (100 Stocks)

100 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: IndusInd Bank, SAIL

Stocks retained in F&O ban: BSE, Hindustan Copper, Manappuram Finance

Stocks removed from F&O ban: Nil