Trade setup for Oct 1: Can NIFTY50 bounce back from 200 WMA levels on Thursday?

GIFT NIFTY futures traded over 83 points lower on Thursday morning, indicating a weak opening for NIFTY50. Though crude oil prices moderated on Wednesday, but elevated bond yields continued to worry global investors more.

Brent crude oil futures moderated below $100 per barrel mark on Thursday morning as diplomatic efforts between the US and Iran continue, also allowing some emergency oil tankers to pass through the Strait of Hormuz, easing supply disruption concerns.

Meanwhile, the US stock markets closed mixed as the Dow Jones shed 400 points, while the NASDAQ 100 rose over 0.2% on Wednesday, as core PCE inflation remained unchanged and below expectations. However, the US Treasury yields continued to surge beyond two-decade high levels. The US 10Y touched the 5.3% mark, and the US 30Y crossed 5.6%.

Amid mixed cues, the Asian markets opened on a positive note, with Japan surging over 2%, the most amongst the regional peers. While, Korean KOSPI and Hong Kong’s Hang Seng posted marginal gains on Thursday morning.

NIFTY50 chart summary

The daily charts of NIFTY50 indicate a make-or-break level for the index as it touched the 200-day weekly moving average level, for the first time since March 2020. The weakness would intensify if the index closes below the 23,500 zone. On the flip side, the 23,000 level remains a crucial resistance zone for NIFTY50 on the upside.

NIFTY50 open interest summary

The open interest data for the coming weekly expiry indicates skewness towards the upside, as 22,700 to 23,000 calls held strong open interest concentration. The 23,000 calls held the highest open interest, indicating a major resistance level for NIFTY50 this week. On the downside, 22,000 puts held the highest open interest after 22,500 puts, indicating near-term support at 22,500 and long-term support at 22,000 levels.