Trade setup for March 2 after intensified US-Iran tensions: Top 15 things to know before the opening bell

Nifty Trade setup for March 2 after intensified US-Iran tensions

• Market to see a sharp gap-down opening on March 2
• 25,000, 24,850 expected to be at major risk as below which Budget Day low can't be ruled out
• Resistance seen in the 25,250–25,350 zone

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The Nifty 50 succumbed to selling pressure, falling 1.25 percent amid weak global cues and rising geopolitical risks on February 27. The index decisively broke not only the 200-day EMA but also the upward-sloping support trendline, with high volumes. The momentum indicators maintained a sell signal, and the bears received a further boost from intensified US-Iran tensions, both of which hint at a sharp gap-down opening for the market on March 2. Hence, the psychological 25,000 mark and the long support trendline (24,850) are now expected to be at major risk, as falling below them can open the door to the Budget Day low of 24,571 (which is 2.4 percent away from Friday's close). However, on the higher side, resistance is placed in the 25,250–25,350 zone, according to experts.

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

1) Key Levels For The Nifty 50 (25,179)

Resistance based on pivot points: 25,393, 25,473, and 25,601

Support based on pivot points: 25,137, 25,058, and 24,930

Special Formation: The Nifty 50 formed a long red candle on the daily timeframe with above-average volumes and dipped below the 200-day EMA and SMA in a single session, signalling that the bears have a strong upper hand. With Friday's fall, the index is now trading below all key moving averages, while the short-term moving averages are trending downward. The RSI dipped to 40.65, while the MACD sustained below the reference line and zero line, with further downside in the histogram. All this indicates sustained bearish momentum.

2) Key Levels For The Bank Nifty (60,529)

Resistance based on pivot points: 60,932, 61,085, and 61,332

Support based on pivot points: 60,437, 60,285, and 60,037

Resistance based on Fibonacci retracement: 61,160, 62,075

Support based on Fibonacci retracement: 60,254, 59,783

Special Formation:The Bank Nifty decisively broke the consolidation range on the downside, falling over a percent and forming a long bearish candle on the daily charts. The index fell below short-term moving averages as well as the midline of the Bollinger Bands, with high volumes. Sustaining below the midline of the Bollinger Bands can intensify bearish sentiment. The RSI dropped to 50.66, reflecting prevailing bearish sentiment, while the MACD turned negative with the first downtick in the histogram since February 3. All this indicates increasing downside pressure.

3) Nifty Call Options Data

According to the weekly options data, the 25,500 strike holds the maximum Call open interest (with 1.47 crore contracts). This level can act as a key resistance level for the Nifty in the short term. It was followed by the 25,400 strike (1.31 crore contracts) and 25,600 strike (1.26 crore contracts).

Maximum Call writing was observed at the 25,400 strike, which saw an addition of 1.05 crore contracts, followed by the 25,300 and 25,350 strikes, which added 98.19 lakh and 68.22 lakh contracts, respectively. There was hardly any Call unwinding seen in the 24,700-25,900 strike band.

4) Nifty Put Options Data

On the Put side, the maximum Put open interest was seen at the 25,000 strike (with 85.11 lakh contracts), which can act as a key support level for the Nifty in the short term. It was followed by the 25,200 strike (51.21 lakh contracts) and the 25,100 strike (44.89 lakh contracts).

The maximum Put writing was placed at the 25,100 strike, which saw an addition of 17.47 lakh contracts, followed by the 25,150 and 24,700 strikes, which added 16.97 lakh and 12.46 lakh contracts, respectively. The maximum Put unwinding was seen at the 25,400 strike, which shed 45.36 lakh contracts, followed by the 25,500 and 25,450 strikes, which shed 45.2 lakh and 26.98 lakh contracts, respectively.

5) Bank Nifty Call Options Data

According to the monthly options data, the 61,000 strike holds the maximum Call open interest, with 16.84 lakh contracts. This can act as a key resistance level for the index in the short term. It was followed by the 62,000 strike (5.94 lakh contracts) and the 61,500 strike (5.77 lakh contracts).

Maximum Call writing was observed at the 61,000 strike (with the addition of 3.51 lakh contracts), followed by the 60,800 strike (90,000 contracts) and 60,900 strike (72,720 contracts). The maximum Call unwinding was seen at the 61,400 strike, which shed 7,080 contracts, followed by the 62,700 and 62,900 strikes, which shed 6,390 and 3,270 contracts, respectively.

6) Bank Nifty Put Options Data

On the Put side, the maximum Put open interest was seen at the 61,000 strike (with 15.89 lakh contracts), which can act as a key level for the index. This was followed by the 60,000 strike (10.52 lakh contracts) and the 59,000 strike (4.87 lakh contracts).

The maximum Put writing was placed at the 59,300 strike (which added 43,770 contracts), followed by the 59,200 strike (33,900 contracts) and the 59,400 strike (23,490 contracts). The maximum Put unwinding was seen at the 61,500 strike, which shed 74,615 contracts, followed by the 61,300 and 61,000 strikes, which shed 66,390 and 48,450 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 sharply to 0.63 on February 27 (the lowest level since February 1), compared to a 0.88 in 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

India VIX, which measures expected market volatility, rebounded to 13.7 with a 4.9 percent rally after a four-day fall and climbed back above all key moving averages, signalling concerns for bulls. As long as it stays above the 13 zone, the bulls are expected to remain at risk. However, sustaining below the 12 zone is necessary for the bulls to enter a comfort zone.

10) Long Build-up (13 Stocks)

A long build-up was seen in 13 stocks. An increase in open interest (OI) and price indicates a build-up of long positions.

11) Long Unwinding (64 Stocks)

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

12) Short Build-up (119 Stocks)

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

13) Short-Covering (14 Stocks)

14 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