Trade setup for Oct 13: Can NIFTY50 defend 22,200 on the weekly expiry on Tuesday?

Indian benchmark indices are expected to open on a positive note, despite weak global market cues.The GIFT NIFTY futures traded 50 points higher, indicating a positive start for NIFTY50.

Brent crude oil prices surged above $106 per barrel on Tuesday amid fresh escalations in the Middle East after Riyadh airport came under severe attacks from Houthi rebels. Meanwhile, Ukraine vows to continue its attacks on Russia, as Moscow keeps attacking Ukraine’s energy infrastructure.

The US stock markets closed mixed on Monday after the S&P 500 ended flat, the NASDAQ 100 fell 0.4%, while Dow Jones gained nearly 200 points. The profit booking in tech stocks pulled the tech-heavy NASDAQ 100 lower, as investors turned cautious ahead of key inflation data release this week.

The Asian markets were painted in deep red on Tuesday morning, especially in Korea, as the benchmark KOSPI plunged 6%. The Japanese Nikkei fell 2.6%, followed by Hong Kong’s Hang Seng at 2.2% and Taiwan's weighted at 2%.

NIFTY50 chart check

NIFTY50 clawed back Friday’s gains by losing 157 points on Monday. The index made intraday high of 22,650 and faced stiff resistance near 22,700 levels. On the hourly charts, the index fell back below 20 and 50 EMA, continuing the bearish momentum alive for the short term.

Additionally, the index also negated the bullish harami candlestick pattern, indicating continuation of bearish trend on the daily time frame. Going forward, the index is likely to post a rangebound activity with a support of 22,250 and resistance at 22,700.

NIFTY50 open interest summary

Ahead of today’s weekly expiry, the open interest data shifted towards call side. The 22,400, 22,500, 22,600, and 22,800 witnessed strong open interest addition on Monday. The 22,600 calls held the highest open interest, indicating a strong resistance for NIFTY50. On the flipside, 22,000 puts held the highest open interest, indicating a strong support fort NIFTY50.