Trade setup for January 16: Top 15 things to know before the opening bell- Grow Mudra

Trade setup for January 16: Top 15 things to know before the opening bell

16 Jan , 2025 By : Debdeep Gupta

The Nifty 50 remained in positive territory amid choppy trade, rising 0.2 percent and extending its uptrend for the second consecutive session on January 15. The Nifty 50 is expected to trade in the range of 23,050–23,350 (Monday's low and high) in the near term, while overall sentiment remains in favour of bears until the index closes above all key moving averages. If the index decisively breaks the lower end of the range, a fall toward 22,800 could be possible. However, if it moves above the upper range, the index may climb toward the 10-day EMA of 23,460 and then the 200-day EMA of 23,680, according to experts.

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

1) Key Levels For The Nifty 50 (23,213)

Resistance based on pivot points: 23,274, 23,309, and 23,365

Support based on pivot points: 23,162, 23,127, and 23,070

Special Formation: The Nifty 50 reported a small bearish candle with minor upper and lower shadows on the daily charts, indicating choppy trade. The index traded near the lower end of the Bollinger Bands, with a negative bias in the momentum indicators—the Relative Strength Index (36) in the lower band and the MACD (Moving Average Convergence Divergence) below the zero line—indicating a bearish phase.

2) Key Levels For The Bank Nifty (48,752)

Resistance based on pivot points: 49,000, 49,133, and 49,347

Support based on pivot points: 48,572, 48,439, and 48,225

Resistance based on Fibonacci retracement: 49,448, 50,407

Support based on Fibonacci retracement: 47,874, 46,078

Special Formation: The Bank Nifty formed a small red candle with long upper and lower shadows, resembling a High Wave-like candlestick pattern on the daily timeframe, indicating indecision. The index saw higher tops and higher bottoms for another session, which is positive, but the overall trend remains weak given that the index traded well below all key moving averages and the momentum indicators have a negative bias.

3) Nifty Call Options Data

According to the weekly options data, the 23,300 strike holds the maximum Call open interest (with 1.44 crore contracts). This level can act as a key resistance for the Nifty in the short term. It was followed by the 24,000 strike (1.35 crore contracts) and the 23,500 strike (1.08 crore contracts).

Maximum Call writing was observed at the 23,300 strike, which saw an addition of 85.72 lakh contracts, followed by the 23,250 and 23,200 strikes, which added 50.15 lakh and 39.5 lakh contracts, respectively. The maximum Call unwinding was seen at the 23,750 strike, which shed 4.9 lakh contracts, followed by the 23,800 and 23,950 strikes, which shed 4.49 lakh and 3.52 lakh contracts, respectively.

4) Nifty Put Options Data

On the Put side, the maximum Put open interest was seen at the 23,200 strike (with 1.34 crore contracts), which can act as a key support level for the Nifty. It was followed by the 23,000 strike (1.14 crore contracts) and the 22,500 strike (88.48 lakh contracts).

The maximum Put writing was placed at the 22,700 strike, which saw an addition of 45.64 lakh contracts, followed by the 23,200 and 22,650 strikes, which added 41.8 lakh and 30.67 lakh contracts, respectively. The maximum Put unwinding was seen at the 22,450 strike, which shed 41.39 lakh contracts, followed by the 22,500 and 22,400 strikes, which shed 17.32 lakh and 15.5 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 18.04 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 (13.05 lakh contracts) and the 50,500 strike (10.17 lakh contracts).

Maximum Call writing was visible at the 49,000 strike (with the addition of 2.47 lakh contracts), followed by the 48,900 strike (1.03 lakh contracts) and the 48,800 strike (80,415 contracts). The maximum Call unwinding was seen at the 47,500 strike, which shed 36,180 contracts, followed by the 50,600 and 48,600 strikes, which shed 30,405 and 19,755 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 13.87 lakh contracts), which can act as a key support level for the index. This was followed by the 47,000 strike (11.7 lakh contracts) and the 49,000 strike (10.35 lakh contracts).

The maximum Put writing was observed at the 48,000 strike (which added 64,455 contracts), followed by the 48,900 strike (26,505 contracts) and the 49,000 strike (25,620 contracts). The maximum Put unwinding was seen at the 47,000 strike, which shed 82,800 contracts, followed by the 48,500 and 50,000 strikes which shed 66,810 and 64,365 contracts, respectively.

7) Funds Flow (Rs crore)

8) Put-Call Ratio

The Nifty Put-Call ratio (PCR), which indicates the mood of the market, fell to 0.82 on January 15, from 0.86 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 Volatility Index (VIX), which measures expected market volatility, fell further by 1.37 percent to 15.26, but it remains unfavourable for bulls to regain strong momentum.

10) Long Build-up (61 Stocks)

A long build-up was seen in 61 stocks. An increase in open interest (OI) and price indicates a build-up of long positions.

11) Long Unwinding (24 Stocks)

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

12) Short Build-up (96 Stocks)

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

13) Short-Covering (45 Stocks)

45 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.