Trade setup for April 9: Can NIFTY50 hold the gains on Thursday? Check details

The crude oil prices jumped over 8% from the Wednesday low as Israel continued to bomb Lebanon’s capital, Beirut. The tensions continued to build up again over the sustainability of the ceasefire. The Brent crude oil prices traded at $98 per barrel on Thursday morning, recouping all the losses from $90 per barrel on Wednesday.

The US markets closed with strong gains across the board as ceasefire news cheered the investor sentiment. The tech stocks were the key leaders in yesterday’s rally as the NASDAQ index closed 2.9% higher, followed by the Dow Jones at 2.85% and the S&P500 at 2.5%.

The Asian markets opened in red after a strong rally on Wednesday as concerns over the continuity of the ceasefire deal soured the investor sentiment. The Korean indices fell 1.2%, followed by Hong Kong’s Hang Seng at 0.8% and Japan’s Nikkei at 0.4% on Thursday morning.

The GIFT NIFTY futures traded 114 points lower on Thursday morning, suggesting a gap-down opening for Indian markets on Thursday amid weak global sentiments.

NIFTY50

The index rallied over 800 points on Wednesday after Iran and the US agreed to a ceasefire for two weeks. On the daily charts, the index closed above the 20 EMA level of 23,430, indicating a renewed buying momentum in the index. However, profit booking at higher levels could drag the index lower. Consequently, 23,400 now becomes a crucial support, and 24,000 becomes a resistance.

Open interest

On the options front, the 23,000 puts witnessed significant open interest addition and hold the highest open interst, indicating a strong downside protection at these levels. Similarly, the upside remains protected at 24,500 levels as strike calls hold the highest open interest for the coming weekly expiry.

💰 Institutional intelligence

Despite a near 4% rally, Foreign Institutional Investors (FIIs) remained net sellers, offloading equities worth ₹2,811 crore. However, this marked their lowest selling in the past six trading sessions.

The selling aligns with a shift in derivatives positioning, as FIIs increased their long exposure and covered short positions in index futures. Over the last three sessions, their long-to-short ratio improved to 21:79 from 17:83, while net open interest declined 15% to -2.27 lakh contracts.

If–then playbook

If the index fails to hold the April 8 low on a closing basis, the near-term structure may turn range-bound. This could lead to a call sellers’ base at and above 24,000, while put writers emerge at and below 23,000.

If the index sustains above the April 8 low on a closing basis, then the call base at the 24,000 strike could trigger a short-covering rally. In that case, the next resistance lies in the 24,350 to 24,500 zone.

Source: Upstox and NSE.