Trade setup for Feb 5: NIFTY50 holds 20 EMA level, will it close above 25,800 on Thursday?

NIFTY50

Max call OI:26,000

Max put OI:25,500

(Ten strikes to ATM, 11 Feb expiry)

The global market setup for Thursday morning remains mixed as tech stocks in US markets continue to rout. Asian markets traded in red across the board on Thursday morning. The GIFT NIFTY futures traded flat at 25,841 on Thursday morning, indicating a flat start for NIFTY50. The index continued to hold on to Tuesday’s gains as the NIFTY50 closed nearly 50 points higher on Wednesday.

On the technical charts, the NIFTY50 closed above the 20 EMA level for the second consecutive session, indicating strong buying interest at the higher levels despite sharp gains on Tuesday. Experts believe the 20 EMA level of 25,648 remains a crucial support for the index in the near future.

On the options data front, the 26,000 calls hold the highest open interest, indicating a strong resistance for the weekly expiry on 11 Feb. On the downside, the 25,500 puts hold the highest open interest, indicating a strong support for the index.

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Long buildup: - Trent, Eternal

Short buildup: Infy, TCS

Top traded futures contracts: Infy TCS

Top traded options contracts: Infy 1640 CE

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