Trade Setup for Tuesday: Top 10 things you should know before Opening Bell

Bulls regained their foothold on D-Street on Monday as Nifty50 managed to reclaim its crucial resistance level of 9,200 and made a ‘Long White Day’ kind of pattern on daily candlestick charts.

A Long White Day on the daily charts and the crossing of all the short term moving averages such as 20-days exponential moving average (DEMA), 5-DEMA, 13-DEMA, and 10-DEMA is a positive sign.

If the momentum continues, the index is now on track to take out its record high level placed at 9273.90. Traders who went long in the market can continue to hold their positions with a stop below 9,130, suggest experts.

We have collated top ten data points on how to help you in spotting profitable trade:

Key Support & Resistance Level for Nifty:

The Nifty50 closed above its crucial resistance level of 9,200 and also above its short-term moving averages such as 20-days exponential moving average, 5-DEMA, 13-DEMA, and 10-DEMA which suggests bullish bias.

According to Pivot charts, the key support level for Nifty50 is placed at 9,157, followed by 9,096. If the index starts to move higher then key resistance levels to watch out are 9,252, followed by 9,286.

Nifty Bank:

Nifty Bank closed 305 points higher or 1.4 percent at 21,857.40 on Monday. Important Pivot level which will act as crucial support for the index is placed at 21,662, followed by 21,467. On the upside, the key resistance level is 21,968 followed by 22,079.

Call Options Data:

Maximum Call open interest (OI) of 45 lakh contracts stands at strike price 9,200 which will act as a crucial resistance level for the index in April series, followed by 9,300 which now holds 40 lakh contracts in open interest and 9,500 which has accumulated 36 lakh contracts in OI.

Call Writing was seen at strike prices 9,400 (2.5 lakh contracts added), followed by 9,500 (3.9 lakh contracts added). Call unwinding was seen at strike prices 9,200 (15 lakh contracts were shed), followed by 9,100 (8.9 lakh contracts shed), 9,300 (3.1 lakh contracts shed), and 9,000 (2 lakh contracts shed).

Put Options Data:

Maximum Put OI of 62 lakh contracts was seen at strike price 9,100 which will act as a crucial base for the index in April series followed by 9,000 which has accumulated 56 lakh contracts in open interest, and 8,900 which now holds 48.68 lakh contracts in open interest.

Put writing was seen at strike prices 8,900 (4.05 lakh contracts added), followed by 9,000 (4.5 lakh contracts added), 9,100 (12 lakh contracts) and 9,200 (23 lakh contracts added).

Put Unwinding was seen at strike prices 9,400 (0.51 lakh contracts shed), followed by 9,500 (0.51 lakh contracts shed), and 9,600 (0.08 lakh contracts shed).

“Fresh Put writing was seen at strike prices 9,200, 9,150 and 9,100 while major Call unwinding was seen at strike price 9,200,” Chandan Taparia, Derivatives, and Technical Analyst at Motilal Oswal Securities told Moneycontrol.com.

“Put writing and Call unwinding was seen at strike price 9,200 has given grip to bulls but maximum Call OI remained intact at strike price 9,200 which is restricting its upside momentum,” he said.

FII & DII Data: 

The foreign institutional investors (FIIs) sold shares worth Rs280 crore compared to domestic institutional investors who bought Rs984 crore in Indian equity market.

Stocks with high Delivery percentage:

High delivery percentage suggests that investors are accepting the delivery of the stock which means that investors are bullish on the stock.

108 stocks saw Long Buildup:

42 stocks saw short covering:

A decrease in open interest along with an increase in price mostly indicates short covering.

7 stocks saw Long Unwinding: 

Long Unwinding happens when there is a decrease in OI as well as in price.

33 stocks saw Short Buildup:

An increase in open interest along with a decrease in price mostly indicates short positions being built up.