Trade setup: NIFTY50 faces resistance at 25,000; here's what options data indicate

Asian markets

Asian markets traded in green across the board taking cues from the overnight gains in the US. The Japanese benchmark indices rally 0.6% after yeilds on government bond and Yen, which eased pressure on the equitiies. Similarly, the Hong Kong and Korean markets too traded in green with 0.5% gains on Wednesday morning.

US markets

The US markets closed with high optimism on Tuesday after President Trump delayed the 50% tariffs on EU till 9th July. The investors are now focusing on earings from Nvidia, world's leading tech brand and among the most valuable companies. The Dow Jones, S&P 500 and NASDAQ closed with strong gains of over 2% on Tuesday.

NIFTY 50

Max call OI:25,000

Max put OI:24,500

(Ten strikes to ATM, 29th May expiry)

After facing resistance near the 25,000 mark, NIFTY50 reversed its course on Tuesday and closed in the red with a 0.7% loss from the previous close, snapping a day's rally. Due to weakness in the Asian peers and profit booking considering 25,000 as a sentimental resistance level, NIFTY50 witnessed a decline.

But the reversal felt short-lived as NIFTY50 bounced back slightly from its intraday lows. Going forward, 25100 and 24500 are likely to act as resistance and support for the NIFTY50 index.

The open interest data indicates that 25,000 may act as a strong resistance for the current expiry, with the highest open interest on the calls side. On the downside, the 24,500 holds the highest open interest, indicating support at these levels.

SENSEX

Max call OI:81,500

Max put OI: 81500

(Ten Strikes to ATM, 3rd June expiry)

SENSEX too closed 0.8% lower after taking multiple resistance near 82300 levels. The index started on a weaker note and tumbled in the first hour itself. Thereafter, the index witnessed some volatility throughout the day and eventually closed in the red after two consecutive days’ rally.

On technical charts, the index is resisting at its key resistance of 82300, which needs to be taken out on a closing basis for any further upside. The index may turn weak below the 80700-80500 zone.

The initial buildup for the 3rd June expiry indicates 81,500 as a crucial level with the highest open interest on both sides. After this, 82,000 calls and 81,000 puts hold the highest open interest.

Stock scanner

Long buildup: Jio Financial Services

Short buildup: Ultratech Cement

Top traded futures contracts: HDFC Bank, ICICI Bank

Top traded options contracts: SBI 800 CE, Reliance 1430 CE

F&O securities under ban: RBL Bank

F&O securities out of ban: Manappuram, Titagarh, Chambal Fertilisers, Hindustan Copper

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