Trade setup: Can NIFTY50 reclaim 50 EMA on Monday? Check details

GIFT NIFTY futures jumped over 260 points at 7:00 am on Monday, indicating a sharp gap-up opening for Indian markets. Cooling off crude oil prices, treasury yields, and the US dollar index will ease the pressure on Indian markets on Monday.

Brent crude oil prices plunged over 4% on Monday morning, after Iran and the US reached a peace deal. The Brent crude oil price now trades below $85 per barrel, nearly at three-month low levels, almost reversing all the gains of the war.

US stock market futures rose over 1% on Monday morning after geopolitical tensions in the Middle East finally cooled, with Iran and the US reaching a peace deal, paving the way for the reopening of the Strait of Hormuz.

The Asian markets opened in green across the board, with Japanese and Korean markets rallying over 5% on Monday morning. The reopening of the Strait of Hormuz and a sharp fall in US Treasury yields have once again boosted prospects for Asian tech stocks, particularly in Japan and Korea.

NIFTY50 chart check

NIFTY50 index bounced back sharply from lower levels and managed to defend it at the close on Friday. The index rallied over 1% for the last week, breaking the streak of negative closing. ON the daily charts, the index closed above the 20 EMA after 10 trading sessions. However, the index has traded below the 50 EMA for 11 trading days. A closing above 50 EMA for two consecutive days would revive bullish momentum in the index. In the long-term, the 23,070 remains a crucial support, with 24,000 as a crucial psychological resistance for NIFTY50.

NIFTY50 OI analysis

The open interest data for tomorrow’s weekly expiry turned bullish on Friday after heavy OI concentration on the lower levels of the NIFTY50. The 23,200 to 23,500 puts witnessed a strong open interest addition, with 23,400 put, holding the highest open interest, indicating strong support at lower levels till 23,200. On the flipside, 24,000 calls hold the highest open interest, indicating a strong resistance for NIFTY50.