Trade setup for June 5: NIFTY50 still holds 24,500 support, but on a cautiously positive note

Asian markets @ 7 am

• GIFT NIFTY: 24,735 (+0.08%)
• Nikkei 225: 37,710 (-0.10%)
• Hang Seng: 23,836 (+0.77%)

U.S. market update

• Dow Jones: 42,427 (-0.22%)
• S&P 500: 5,970.81 (+0.01%)
• Nasdaq Composite: 19,460 (+0.32%)

NIFTY50

• Max call OI: 25,000
• Max put OI: 24,600
• (Ten strikes to ATM, 5th June expiry)

Taking strong cues from the major US indices and Asian peers, the NIFTY50 index opened the June 4th session on a positive note. Moreover, optimism ahead of the RBI policy review, due this week, also contributed to the positive sentiment. However, the session turned lacklustre due to a lack of any major triggers, and caution regarding ongoing tariff concerns restrained the benchmark index from achieving significant gains. Ultimately, the NIFTY50 index closed in green but with marginal gains of 0.3%.

NIFTY50 has formed a green candle, maintaining the support at 24,500. However, the bounce back seems insignificant for now, as the daily candle is too short to depict any reversal for now. Moreover, a 14-period RSI has given a prior swing low breakdown which portrays loss of momentum. Hence, the index seems to be struggling at its crucial support of 24,500. On the upside, 24,850 which is a current swing high to act as the resistance for now.

On the options data front, the 25,000 calls hold the highest open interest for the 5th June expiry, indicating a strong resistance at these levels. On the downside, the index holds the highest open interest at 24,600 puts, indicating strong support at these levels.

SENSEX

• Max call OI: 81,000
• Max put OI: 81,000
• (Ten strikes to ATM, 10th June expiry)

Despite a strong negative closing in the previous session, like NIFTY50, SENSEX too opened the June 4th session on a positive note. However, after a very gradual but consistent upbeat, the index closed with marginal gains of 0.3%.

SENSEX too has recovered slightly from its support, but the insignificant green candle on the daily chart just depicts consolidation for now. Hence, below the 80500-80700, which is a crucial support, the next support would be the 80,000 mark. On the upside, above 81,340, 81800 would act as the next resistance.

On the options data front, the initial buildup on options indicates a tight range for SENSEX as Index continued to face heavy resistance and support both at the 81,000 levels due to the highest open interest on the call side and the put side, respectively.

Stock scanner

• Long buildup: JIOFIN
• Short buildup: BAJAJFINSERV
• Top traded futures contracts: ETERNAL FUT
• Top traded options contracts: BSE 2800CE, HAL 5000CE

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