Trade setup for July 29: Can NIFTY50 bounce back above 24,000 on Wednesday?

Crude oil prices bounced back 2.5% on Wednesday early morning, after Iran launched surprise attacks on US bases in the Middle East. Brent crude oil price rose 2.6% to $85 per barrel after hitting $80 per barrel on Tuesday.

US stock markets closed mixed on Tuesday as chip stocks extended their fall. The Dow Jones rose more than 500 points or 1%, and the S&P 500 rose 0.2%. Meanwhile, the NASDAQ 100 closed 1% lower as chip stocks continued to remain under pressure.

Asian markets remained under pressure on Wednesday morning as tech stocks extended their decline. The Korean KOSPI plunged 5% to a three-month low, while Japan's Nikkei tumbled over 850 points or 1.3%, dragged down by a selloff in technology shares.

Despite the mixed global market cues, GIFT NIFTY futures jumped over 200 points on Wednesday morning, indicating a positive start for the NIFTY50.

NIFTY50 chart check

The NIFTY50 started Tuesday’s session in positive territory but surrendered its early gains amid expiry-day volatility. The index concluded the session 10 points lower, finishing below the hourly 50-day EMA while defending the 20-day EMA. This positioning reflects investor indecision at the start of the August series.

On the daily time frame, the index formed an inverted hammer candlestick, indicating intensified selling pressure near the psychological 24,000 mark. As highlighted previously, a monthly close will be pivotal for determining the broader trend and long-term trajectory for the index.

NIFTY50 open interest

The initial buildup for coming weekly expiry data suggests that 24,000 remains a crucial level of support and resistance for NIFTY50 with highest open interest on both call and put side. However, 24,100, 24,200 and 24,300 calls hold strong open interest concentration, suggesting limited upside.