Trade setup for January 14: Top 15 things to know before the opening bell- Grow Mudra

Trade setup for January 14: Top 15 things to know before the opening bell

14 Jan , 2025 By : Debdeep Gupta

The market had a negative start to the week as the benchmark Nifty 50 fell by 1.5 percent on January 13 due to broad-based selling, hitting a fresh seven-month low. The index has lost 1,180 points from its January high. Sentiment remains bearish, with the index trading well below all key moving averages. However, a rebound cannot be ruled out, as the momentum indicator RSI has approached near-oversold levels. If a rebound occurs, the index may face resistance in the 23,200–23,350 zone. On the other hand, if the downtrend extends, a fall towards 22,800 is possible, according to experts.

Here are 15 data points we have collated to help you spot profitable trades:

1) Key Levels For The Nifty 50 (23,086)

Resistance based on pivot points: 23,270, 23,340, and 23,452

Support based on pivot points: 23,046, 22,976, and 22,864

Special Formation: The Nifty 50 formed a bearish candlestick pattern with an upper shadow on the daily charts, accompanied by above-average volumes, indicating a lack of demand at higher levels. The index has been forming lower highs for the seventh straight session and continues to trade below all key moving averages. Notably, the 10-day EMA line has fallen below the 200-day EMA. Momentum indicators also maintained a negative bias, with the RSI (Relative Strength Index) at 32.2 (oversold levels are below 30) and the MACD (Moving Average Convergence Divergence) signaling continued weakness.

2) Key Levels For The Bank Nifty (48,041)

Resistance based on pivot points: 48,452, 48,620, and 48,890

Support based on pivot points: 47,912, 47,744, and 47,474

Resistance based on Fibonacci retracement: 49,445, 50,414

Support based on Fibonacci retracement: 47,887, 46,088

Special Formation: The Bank Nifty continued its southward journey for the fourth consecutive session, forming a bearish candlestick pattern with a long upper wick on the daily timeframe, reflecting a lack of buying interest at higher levels. The index also traded well below all key moving averages, reinforcing bearish sentiment. The momentum indicator RSI fell to 25.31, its lowest level since October 26, 2023, entering oversold territory and signaling a possible rebound.

3) Nifty Call Options Data

According to the weekly options data, the 24,000 strike holds the maximum Call open interest (with 1.06 crore contracts). This level can act as a key resistance for the Nifty in the short term. It was followed by the 23,500 strike (97.79 lakh contracts) and the 23,400 strike (66.16 lakh contracts).

Maximum Call writing was observed at the 23,300 strike, which saw an addition of 57.96 lakh contracts, followed by the 23,500 and 23,400 strikes, which added 54.94 lakh and 53.46 lakh contracts, respectively. The maximum Call unwinding was seen at the 23,800 strike, which shed 4.55 lakh contracts.

4) Nifty Put Options Data

On the Put side, the 23,000 strike holds the maximum Put open interest (with 70.12 lakh contracts), which can act as a key support level for the Nifty. It was followed by the 22,500 strike (57.02 lakh contracts) and the 22,200 strike (44.87 lakh contracts).

The maximum Put writing was placed at the 23,100, which saw an addition of 24.74 lakh contracts, followed by the 23,000 and 22,200 strikes, which added 24.32 lakh and 20.02 lakh contracts, respectively. The maximum Put unwinding was seen at the 23,400 strike, which shed 17.4 lakh contracts, followed by the 23,500 and 23,450 strikes, which shed 15.95 lakh and 7.23 lakh contracts, respectively.

5) Bank Nifty Call Options Data

According to the monthly options data, the 50,000 strike holds the maximum Call open interest, with 19.49 lakh contracts. This can act as a key resistance level for the index in the short term. It was followed by the 49,000 strike (11.74 lakh contracts) and the 49,500 strike (9.93 lakh contracts).

Maximum Call writing was visible at the 48,500 strike (with the addition of 4.76 lakh contracts), followed by the 48,000 strike (3.3 lakh contracts) and the 49,000 strike (2.84 lakh contracts). The maximum Call unwinding was seen at the 48,900 strike, which shed 40,110 contracts, followed by the 49,200 and 49,100 strikes, which shed 9,900 and 7,125 contracts, respectively.

6) Bank Nifty Put Options Data

On the Put side, the maximum Put open interest was seen at the 48,000 strike (with 12.86 lakh contracts), which can act as a key support level for the index. This was followed by the 47,000 strike (12.59 lakh contracts) and the 46,000 strike (12.62 lakh contracts).

The maximum Put writing was observed at the 48,200 strike (which added 1.53 lakh contracts), followed by the 48,100 strike (1.5 lakh contracts) and the 48,000 strike (1.44 lakh contracts). The maximum Put unwinding was seen at the 49,000 strike, which shed 3.38 lakh contracts, followed by the 46,000 and 49,500 strikes which shed 2.41 lakh and 1.5 lakh contracts, respectively.

7) Funds Flow (Rs crore)

8) Put-Call Ratio

The Nifty Put-Call ratio (PCR), which indicates the mood of the market, dropped to 0.72 on January 13, from 0.88 level in the previous session.

The increasing PCR, or being higher than 0.7 or surpassing 1, means traders are selling more Put options than Call options, which generally indicates the firming up of a bullish sentiment in the market. If the ratio falls below 0.7 or moves towards 0.5, then it indicates selling in Calls is higher than selling in Puts, reflecting a bearish mood in the market.

9) India VIX

The India VIX, which measures expected market volatility, extended its upward trend for the third consecutive session, closing at the 16 level, a 7.26 percent increase on Monday. This spike in volatility further adds discomfort for the bulls.

10) Long Build-up (6 Stocks)

A long build-up was seen in 6 stocks. An increase in open interest (OI) and price indicates a build-up of long positions.

11) Long Unwinding (92 Stocks)

92 stocks saw a decline in open interest (OI) along with a fall in price, indicating long unwinding.

12) Short Build-up (127 Stocks)

127 stocks saw an increase in OI along with a fall in price, indicating a build-up of short positions.

13) Short-Covering (2 Stocks)

2 stocks saw short-covering, meaning a decrease in OI, along with a price increase.

14) High Delivery Trades

Here are the stocks that saw a high share of delivery trades. A high share of delivery reflects investing (as opposed to trading) interest in a stock.