Trade setup for July 24: Can NIFTY50 bounce back from lower levels on Friday?

GIFT NIFTY futures were trading 176 points lower at 23,680 levels at 8 am on Friday, indicating a gap-down opening for the NIFTY50. Elevated crude oil prices, US treasury yields and the dollar index will continue to remain key drivers for Indian markets on Friday.

Brent crude oil prices stabilised on Friday morning after hitting $101 per barrel overnight. The situation in the Middle East remains volatile after the US launched multiple strikes on Iranian infrastructure targets.

US stock markets closed in the red as investors remain anxious over renewed fears of sticky inflation and excessive AI infrastructure spending by megacap companies. The Dow Jones tumbled over 500 points or nearly 1%, the S&P 500 fell 1.2%, and the NASDAQ 100 slipped over 2%.

Asian markets opened in the red on Friday morning, taking cues from overnight losses in the US markets. The Japanese Nikkei plunged nearly 2,000 points or 3%, the Korean KOSPI fell 3.9% and the Hang Seng slipped 1%.

NIFTY50 charts

The NIFTY50 fell for the fourth straight session on Thursday, as persistent selling pressure at higher levels weighed on the index. After failing to defend the psychologically important 24,000 mark, the index continued to trade below its hourly 20-day and 50-day EMAs for the second consecutive day, indicating intensified bearish momentum.

On the daily charts, the NIFTY50 slipped below its 50-day EMA support of 23,992, further weakening the near-term structure. Going forward, the 23,650 zone remains a crucial support, while the 24,000 level will act as immediate resistance for Friday’s trade.

NIFTY50 open interest analysis

The open interest data for the monthly expiry suggests that 24,000 calls hold the highest open interest on the upside, indicating a strong near-term resistance. On the other hand, 23,500 puts hold the highest open interest, indicating strong support on the downside.