Nifty 50: Will it Break the 25000 Barrier?

Nifty 50: Will it Break the 25000 Barrier? Indian stock markets opened higher on Monday, reflecting gains in global markets. Analysts expect strong performance but highlighted potential impacts from geopolitical factors and the upcoming earnings season. The Nifty 50 has support around 24,800 points.

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Nifty 50: Will it Break the 25000 Barrier?

Indian shares opened higher on Monday

On Monday, the domestic benchmark indices, the Sensex and Nifty 50, started the day on a positive note, reflecting gains in global markets. In the previous week, Indian markets had dropped by over 4%. Strong US jobs data eased concerns about a potential recession in the world’s largest economy, which helped boost domestic shares, particularly in the information technology sector. The Nifty 50 opened at 25,084.10, rising by 69.50 points or 0.28%, while the Sensex opened at 81,852.01, with a gain of 163.56 points or 0.20%.

Market analysts have forecasted continued strong performance for Indian stock markets this week but highlighted potential impacts from geopolitical factors and the upcoming earnings season. Technical analysts in the derivatives segment noted that Foreign Institutional Investors (FII) have reduced their long positions in index futures and have added new short positions. The long-short ratio has dropped from 81% at the beginning of the series to 58%. Unless there is a shift in the FII’s approach, markets may continue to experience selling pressure during pullback rallies. The Nifty 50 has support around 24,800 points.

For Bank Nifty, the last expiry date was Tuesday, October 1. The index faced selling pressure around the 52,200 level, closing below its 50-day EMA and forming a bearish candlestick on the daily chart, signaling a strong bearish sentiment and market dominance by sellers. The outlook now suggests a “sell on rise” strategy, with key support at the rising trendline near 51,000 and resistance expected at 51,900. The index’s inability to stay above these levels emphasizes a cautious market approach.

In terms of Open Interest analysis, there was limited PUT writing on the second day of the new expiry, while significant CALL writing was observed at the 52,000 level, indicating strong short-term resistance at 52,500. Maximum CALL open interest was seen at 52,500, and maximum PUT open interest was at the 50,500 strike, defining a wide range for the near term. Both PUT and CALL writers were equally active in the weekly expiry.

Nifty 50 bearish, support at 24,750

For the Nifty 50, the last expiry date was Thursday, October 3. The index experienced its second consecutive day of bearish pressure, with trading remaining below key levels, causing a correction toward 25,000. Market sentiment has weakened considerably, with higher levels now presenting selling opportunities. On the downside, support is expected around 24,750, while resistance is anticipated near 25,300.

In the Open Interest analysis, there was minimal PUT writing on the first day of the new expiry, but significant CALL writing was observed at the 25,400 level, indicating strong short-term resistance there. Maximum PUT open interest was seen at the 24,500 strike, while maximum CALL open interest was at 25,500, signaling a wider market range. Both PUT and CALL writers were actively involved in the weekly expiry.

The stock has been trading near a rising trendline, which could offer strong short-term support. It has also been forming a pattern of higher highs and higher lows, indicating a potential recovery from the current level unless it drops below 1,300. On the higher side, it could rise toward 1,430.

The stock recently increased after forming an inverted hammer pattern on the daily chart. The trend is expected to remain strong as long as it stays above its 50-day moving average (50DMA). On the upside, it may move toward 1,310, with support at 1,229.