Trade setup for March 26: Top 15 things to know before the opening bell

Nifty Trade Setup

Bulls managed to lift the Nifty 50 above 23,800 in the morning, but failed to sustain the level due to profit-taking, closing flat with a positive bias on March 25. The consolidation was in line with expectations, but the trend remains positive as the index maintained a higher tops-higher bottoms formation for the sixth consecutive session and sustained above all key moving averages. A further rally toward 24,000 is possible only if the index decisively closes and sustains above 23,800. Until then, the consolidation may continue with support at the 23,500-23,400 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 (23,669)

Resistance based on pivot points: 23,816, 23,879, and 23,981

Support based on pivot points: 23,611, 23,547, and 23,445

Special Formation: The Nifty 50 formed a bearish candlestick pattern resembling a Shooting Star (not a classical one) on the daily charts. This is generally considered a bearish pattern, but confirmation can only be seen in the following session. The momentum indicators, RSI (Relative Strength Index at 71.65) and MACD (Moving Average Convergence Divergence), maintained an upward bias.

2) Key Levels For The Bank Nifty (51,608)

Resistance based on pivot points: 51,943, 52,092, and 52,335

Support based on pivot points: 51,458, 51,308, and 51,066

Resistance based on Fibonacci retracement: 51,883, 53,020

Support based on Fibonacci retracement: 51,262, 50,273

Special Formation: The Bank Nifty closed lower by 97 points and formed a bearish candlestick pattern with both upper and lower shadows on the daily timeframe, indicating some volatility. However, it sustained a higher tops-higher bottoms formation for the ninth straight session, and the index traded well above all key moving averages, which is a positive sign.

3) Nifty Call Options Data

According to the monthly options data, the maximum Call open interest was seen at the 24,000 strike (with 1.28 crore contracts). This level can act as a key resistance for the Nifty in the short term. It was followed by the 24,500 strike (1.26 crore contracts), and the 24,100 strike (1.22 crore contracts).

Maximum Call writing was observed at the 24,000 strike, which saw an addition of 28.54 lakh contracts, followed by the 23,800 and 24,500 strikes, which added 26.99 lakh and 23.82 lakh contracts, respectively. The maximum Call unwinding was seen at the 24,200 strike, which shed 10.62 lakh contracts, followed by the 23,000 and 23,600 strikes, which shed 8.37 lakh and 6.11 lakh contracts, respectively.

4) Nifty Put Options Data

On the Put side, the 23,000 strike holds the maximum Put open interest (with 1.3 crore contracts), which can act as a key support level for the Nifty. It was followed by the 23,500 strike (83.47 lakh contracts) and the 23,200 strike (79.34 lakh contracts).

The maximum Put writing was placed at the 23,700 strike, which saw an addition of 20.63 lakh contracts, followed by the 23,800 and 23,750 strikes, which added 16.35 lakh and 13.38 lakh contracts, respectively. The maximum Put unwinding was seen at the 23,300 strike, which shed 13.78 lakh contracts, followed by the 22,750 and 22,800 strikes, which shed 3.76 lakh and 3.64 lakh contracts, respectively.

5) Bank Nifty Call Options Data

According to the monthly options data, the 53,000 strike holds the maximum Call open interest, with 21.93 lakh contracts. This can act as a key resistance level for the index in the short term. It was followed by the 52,000 strike (18.59 lakh contracts) and the 52,500 strike (11.68 lakh contracts).

Maximum Call writing was visible at the 53,000 strike (with the addition of 5.54 lakh contracts), followed by the 52,000 strike (4.71 lakh contracts) and the 51,900 strike (2.7 lakh contracts). The maximum Call unwinding was seen at the 51,000 strike, which shed 96,810 contracts, followed by the 50,500 and 53,400 strikes, which shed 92,280 and 78,840 contracts, respectively.

6) Bank Nifty Put Options Data

On the Put side, the maximum Put open interest was seen at the 50,000 strike (with 17.9 lakh contracts), which can act as a key support level for the index. This was followed by the 51,000 strike (12.6 lakh contracts) and the 51,500 strike (10.37 lakh contracts).

The maximum Put writing was observed at the 51,900 strike (which added 1.49 lakh contracts), followed by the 51,800 strike (1.46 lakh contracts) and the 51,500 strike (1.34 lakh contracts). The maximum Put unwinding was seen at the 50,000 strike, which shed 2.74 lakh contracts, followed by the 49,800 and 51,000 strikes which shed 1.38 lakh and 1.27 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 1.04 on March 25, against 1.22 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, which measures expected market volatility, declined by 0.47 percent to finish 13.64, after climbing to 14.48 levels intraday. It needs to sustain below the 14 mark for the bulls to remain in the comfort zone.

10) Long Build-up (18 Stocks)

A long build-up was seen in 18 stocks. An increase in open interest (OI) and price indicates a build-up of long positions.

11) Long Unwinding (98 Stocks)

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

12) Short Build-up (75 Stocks)

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

13) Short-Covering (29 Stocks)

29 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: IndusInd Bank

Stocks removed from F&O ban: Nil