Trade setup for April 1: Can NIFTY50 hold the opening gains on Wednesday?

GIFT NIFTY futures traded over 22,700 indicating a positive gap-up opening for Indian markets on Wednesday morning.

Crude oil prices plummeted to near $100 per barrel level on Tuesday night paring all the intraday gains after Iran’s President Masoud Pezeshkian stated that Iran has the “necessary will” to end the war if guarantees are provided.

However, the crude oil prices rallied back to $105 per barrel on Wednesday as investors remain cautious on the supply risks despite the negotiation talks.

US markets rejoiced at the statement made by the Iranian President. The Dow Jones jumped over 1,200 points, the S&P 500 rallied 2.9% and the NASDAQ closed over 3.8% on Tuesday.

Taking the cues from overnight gains in the US markets, the Asian markets rallied on Wednesday morning across the board. The Japanese indices jumped over 3%, Korean indices jumped 6%, the most in Asia.

🔎 What matters today

• Implied trading range: 21,600 to 23,200
• OI resistance: 24,000
• OI support: 22,000
• Structure: Rangebound
• Intraday tone: Sideways to bullish

NIFTY50 options data

Positioning

💰 Institutional intelligence

Foreign institutional investors (FIIs) sold equities worth ₹1,22,540 crore in March, remaining net sellers across all 19 trading sessions. This is their highest monthly outflow since October 2024, when the NIFTY50 had just peaked at its previous all-time high in September 2024.

FIIs have begun the April series with a long-to-short ratio of 15:85. Net open interest in index futures stands at -2.64 lakh contracts, indicating that significant positions remain skewed toward the short side.

Given this heavy short positioning, traders should remain alert to potential short-covering moves. Historically, April has been a positive month for NIFTY50, but with elevated implied volatility, the market may remain choppy. Given the setup, avoiding naked option buying appears prudent in a holiday-shortened week.

• Expiry: April 7
• Resistance: 23,500
• Support: 22,000
• Call concentration: 24,000
• Put concentration: 22,000
• Bullish above: 23,500
• Bearish below: 22,000

Trend summary: 1-hour chart

The index closed below the crucial support level of 22,400 amid intense selloff by the FIIs. The daily chart shows a breakdown after NIFTY50 closed below the previous low level of 22,471. The hourly chart shows the next major support level at 22,000. However, any bounce back from the current level is likely to get sold off until NIFTY50 closes above 23,000.

If–then playbook

The broader technical structure of the NIFTY50 index remains bearish, with the index trading below all key moving averages. A daily close above the 23,500 zone will signal the index slipping into a range-bound structure, with resistance around the 24,500 zone.

As the broader trend remains bearish, traders should exercise caution and focus on counter-trend rallies. The immediate resistance for NIFTY50 is in the 23,000–23,200 zone. A decisive close above this range could indicate a shift towards a range-bound structure. However, negative price action followed by reversal candlestick patterns may signal exhaustion at higher levels, suggesting that the short-covering rally is losing momentum.

Source: Upstox and NSE.