Trade setup for Feb 25: NIFTY50 ends six-day consolidation, faces resistance at 22,800

Asian markets @ 7 am

• GIFT NIFTY: 22,588 (+0.01%)
• Nikkei 225: 22,588 (-0.95%)
• Hang Seng: 22,716 (-2.75%)

U.S. market update

• Dow Jones: 43,461 (▲0.0%)
• S&P 500: 5,938 (▼0.5%)
• Nasdaq Composite: 19,286 (▼1.2%)

U.S. indices surrendered all its intraday gains and sold off during the closing hour of Monday’s trading session. This comes after the U.S. President Donald Trump said that the tariffs on Canada and Mexico would go forward as the month-long delay on implementation expires next week.

Meanwhile, all eyes will be on Nvidia's strategy for dealing with potential tariffs when it reports earnings on Wednesday, the key event of the week. Investors will be keeping a close eye on big tech's demand for AI, as well as competition from China's DeepSeek with its lower-cost technology.

NIFTY50

• February Futures: 22,612 (▼0.9%)
• Open interest: 1,55,475 (▼22.6%)

The NIFTY50 index started its monthly expiry week on a negative note amid weak global cues. The index broke out of its six-day long consolidation range and closed 1% lower at 22,533.

On the daily chart, the index has formed a bearish candlestick and on a closing basis, has breached the key support zone of the January lows around the 22,700-22,800. After the breach, the index is currently trading near the important support zone of 22,500-22,400. A break of this zone on an intraday or closing basis will signal further weakness. Meanwhile, the immediate resistance for the index is now between the 22,700-22,800 zone.

The open interest (OI) data for the 27 February expiry saw significant call build-up at 23,000 and 22,800 strikes, pointing at resistance for the index around these levels. Meanwhile, the put OI base was observed at 22,500 and 22,300 strikes, hinting at support for the index around these zones but with relatively low volume.

SENSEX

• Max call OI: 75,000
• Max put OI: 74,000
• (20 Strikes from ATM, Expiry: 25 Feb)

The SENSEX extended its losing streak to five consecutive sessions, slipping over 1% ahead of the final expiry of its February options contracts. The index's technical structure on the daily chart remains bearish, as it closed below the key support zone of 75,600-75,200, which now acts as immediate resistance. Meanwhile, the next critical support zone is around 73,600.

The index's price action and technical setup on the 15-minute time frame remain weak, with immediate resistance near the 75,500 zone. Additionally, following the gap-down opening, an unfilled gap between the 75,000 and 74,900 zones may act as a near-term hurdle. On the downside, support is evident around the 74,200 zone. A decisive break of this range with a strong intraday candle could offer further directional cues.

The open interest (OI) data of SENSEX’s today’s expiry saw significant build-up of call OI at 75,000 strike, indicating resistance for the index around this zone. On the flip side, the put base was seen at 74,000 strike, suggesting support for the index around this level.

FII-DII activity

Stock scanner

• Long build-up: Glenmark Pharmaceuticals
• Short build-up: LTIMindtree, Infosys, Tata Consultancy Services, ONGC and Max Healthcare
• Top traded futures contracts: HDFC Bank, ICICI Bank, Reliance Industries, Bajaj Finance and Infosys
• Top traded options contracts: Mahindra & Mahindra 2700 CE, BSE 5600 PE, Dixon 13500 PE, Persistent 5500 PE and HDFC Bank 1680 CE
• Under F&O ban: Manappuram Finance

In Futures and Options or F&O, long build-up means an increase in Open Interest (OI) along with an increase in price, and short build-up means an increase in Open Interest(OI) along with a decrease in price.

Source: Upstox and NSE.

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