Expiry trade setup: Options data indicates range of 24,500 to 25,000 for Expiry

NIFTY50

Max call OI:25,000

Max put OI:24,500

(Ten strikes to ATM, 28 Aug Expiry)

NIFTY50 to braces for a negative start on Thursday morning after US additional 25% tariffs on India came into effect. The continues to witness heavy selling pressure at higher levels, especially near 25,000 and low buying interest at the 24,500 levels. This has kept the index consolidating for over a month.

On the technical front, the index has broken a crucial near-term support of the 20 SMA, indicating a bearish trend for the index; however, on a longer-term chart of a monthly period, the NIFTY50 has formed a doji candlestick pattern, indicating the absence of direction in the markets.

On the options data front, the 25,000 calls hold the highest open interest for today’s expiry, indicating crucial resistance for the index. On the other hand, the 24,500 puts hold the highest open interest, indicating a crucial support for the index.

Bullish outlook

Traders with bullish sentiment can execute a long call strategy by buying 24,700 calls. The strategy would turn profitable after the index moves above 24,784.

Bearish outlook

Traders with a bearish outlook can execute a long put strategy by buying a put strike of 24,800. The strategy would turn profitable after the index moves below the 24,687 level.