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

Market Trend

The benchmark index Nifty 50 recorded a robust rally and ended at a new closing high of 25,791, up 375 points on September 20. The index closed above the rising resistance trendline with a positive bias in the momentum indicators, RSI and MACD, which are key drivers. As a result, the trend remains positive, and the next resistance to watch would be the 26,000 mark in the monthly F&O expiry week, but only after some consolidation, with support at 25,500, according to experts. Below are 15 data points we have collated to help you spot profitable trades:

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

1) Key Levels For The Nifty 50

Resistance based on pivot points: 25,830, 25,950, and 26,112

Support based on pivot points: 25,527, 25,428, and 25,266

Special Formation: The Nifty 50 formed a long bullish candlestick pattern on the daily charts with above-average volumes and maintained a higher highs-higher lows formation for another session. On the weekly timeframe, the index saw a breakout from the last three weeks' congestion zone and recorded a bull candle with a higher high-higher low formation.

2) Key Levels For The Bank Nifty

Resistance based on pivot points: 53,888, 54,268, and 54,661

Support based on pivot points: 53,239, 52,996, and 52,604

Resistance based on Fibonacci retracement: 54,370, 54,897

Support based on Fibonacci retracement: 53,024, 52,388

Special Formation: The Bank Nifty also recorded a bullish candlestick pattern on the daily timeframe with above-average volumes, surpassing the horizontal resistance trendline. Momentum indicators remained positive, which is a good sign. The index gained 1.4 percent to close at 53,793 on Friday and rallied 3.6 percent for the week, forming a robust bullish candlestick pattern on the weekly scale.

3) Nifty Call Options Data

According to the monthly options data, the maximum open interest was seen at the 27,000 strike (with 92.08 lakh 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 (62.97 lakh contracts) and the 26,500 strike (54.87 lakh contracts).

Maximum Call writing was observed at the 25,700 strike, which saw an addition of 14.9 lakh contracts, followed by the 26,200 and 27,000 strikes, which added 14.11 lakh and 12.29 lakh contracts, respectively. The maximum unwinding was seen at the 25,500 strike, which shed 19.23 lakh contracts, followed by the 25,400 and 26,000 strikes, which shed 12.56 lakh and 7.2 lakh contracts, respectively.

4) Nifty Put Options Data

On the Put side, the 25,000 strike holds the maximum open interest (with 1.08 crore contracts), which can act as a key support level for the Nifty. It was followed by the 25,500 strike (75.05 lakh contracts) and the 24,500 strike (59.34 lakh contracts).

The maximum Put writing was observed at the 25,700 strike, which saw an addition of 44.21 lakh contracts, followed by the 25,600 and 25,500 strikes, with 38.32 lakh and 33.03 lakh contracts added, respectively, while the Put unwinding was seen at the 25,000 strike, which shed 8.15 lakh contracts, followed by the 27,000 strike, which shed 29,450 contracts.

5) Bank Nifty Call Options Data

According to the monthly options data, the maximum open interest was seen at the 54,000 strike, with 22.57 lakh contracts. This can act as a key resistance level for the index in the short term. It was followed by the 55,000 strike (18.64 lakh contracts) and the 53,500 strike (14.05 lakh contracts).

Maximum Call writing was visible at the 54,000 strike (with the addition of 3.24 lakh contracts), followed by the 53,800 strike (1.58 lakh contracts) and the 54,600 strike (1.35 lakh contracts), while the maximum unwinding was seen at the 53,000 strike, which shed 8.62 lakh contracts, followed by the 53,200 and 53,500 strikes, which shed 7.58 lakh and 7.13 lakh contracts, respectively.

6) Bank Nifty Put Options Data

On the Put side, the 53,000 strike holds the maximum open interest (with 23.77 lakh contracts), which can act as a key support level for the index. This was followed by the 52,500 strike (16.99 lakh contracts) and the 53,500 strike (13.39 lakh contracts).

The maximum Put writing was observed at the 53,500 strike (which added 10.65 lakh contracts), followed by the 53,400 strike (5.97 lakh contracts) and the 53,300 strike (5.34 lakh contracts), while there was hardly any Put unwinding seen.

7) Funds Flow (Rs crore)

8) Put-Call Ratio

The Nifty Put-Call ratio (PCR), which indicates the mood of the market, spiked to 1.5 on September 20, from 1.26 levels 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

Volatility saw some increase after a day of sharp decline but overall remained at lower levels and below all key moving averages, which is a positive sign for the bulls. The India VIX, or fear index, rose by 2.57 percent to 12.79, up from 12.47 levels.

10) Long Build-up (68 Stocks)

A long build-up was seen in 68 stocks. An increase in open interest (OI) and price indicates a build-up of long positions.

11) Long Unwinding (21 Stocks)

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

12) Short Build-up (35 Stocks)

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

13) Short-Covering (59 Stocks)

59 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: Aarti Industries, Biocon, Chambal Fertilisers and Chemicals, GNFC, Granules India, LIC Housing Finance, NALCO, Oracle Financial Services Software, Punjab National Bank, RBL Bank, SAIL

Stocks removed from F&O ban: Birlasoft

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