NIFTY DERIVATIVE ANALYSIS for 21 April 2025

 Hello everyone, 

Open Interest (OI) & Put-Call Ratio (PCR)

  • Futures OI: Increased by 14.18%, indicating fresh positions being added.

  • Calls: 96.3 million contracts. Call OI: Rose by 5.68%.

  • Puts: 110.5 million contracts. Put OI: Surged by 18.78%, suggesting a stronger build-up on the put side

  • Put-Call Ratio (PCR): 1.15​. A PCR above 1 indicates a higher accumulation of put options compared to call options, suggesting a bullish sentiment among traders.This data suggests a bullish undertone, with significant activity in puts indicating traders are hedging or anticipating potential downside protection.

    Key Strike Prices & Open Interest Levels

    • Highest Call OI:

      • 24,000 CE: 53.6 million contracts. Highest call OI, indicating strong resistance

      • 24,500 CE: 36.7 million contracts. 23,500 and 23,800 strikes: Notable call writing, reinforcing resistance zones.

    • Highest Put OI:

      • 23,000 PE: Significant accumulation. Significant put OI, suggesting strong support.

      • 23,300 PE: Notable interest. 22,500 and 22,000 strikes: Additional support levels based on put writing.

      These levels indicate strong resistance around 24,000 and solid support near 23,000.These levels are critical for traders to watch, as they often act as psychological barriers and can influence market direction.

    • Futures Pricing

      • Nifty April Futures: Closed at 23,848.90, slightly below the spot price of 23,851.65, indicating a minor discount. ​This small discount suggests a neutral to mildly bearish short-term outlook among futures traders.

      • Interpretation & Strategy

        • Market Sentiment: The elevated PCR and substantial put OI at lower strikes reflect a cautiously bullish stance among market participants.

        • Resistance Levels: The accumulation of call OI at 24,000 and 24,500 suggests potential resistance zones.

        • Support Levels: Strong put OI at 23,000 and 23,300 indicates robust support levels.

        • Trading Strategy:

          • Range-Bound Approach: Consider strategies like Iron Condors or Butterflies between 23,000 and 24,000 to capitalize on the expected consolidation.

          • Breakout Strategy: If Nifty breaks above 24,000 with volume, bullish strategies like Bull Call Spreads could be effective.

          • Breakdown Strategy: A fall below 23,000 may warrant bearish strategies such as Bear Put Spreads.
          • The derivatives data indicates a cautiously bullish sentiment:​
          • Bullish Indicators:
          • Increase in futures and put OI.
          • Rising PCR.​
          • Cautionary Notes:
          • Significant resistance at 23,500 and 24,000 levels. Potential for consolidation or pullback if these resistances hold.
            • Trading Strategy Suggestions:
            • For Bullish Traders:

            • Consider bullish strategies like bull call spreads, especially if Nifty sustains above 23,500.
            • For Cautious Traders:

            • Wait for a clear breakout above 24,000 before entering aggressive long positions.
            • For Bearish Traders:

          • Monitor for signs of reversal near resistance levels to consider short positions, with tight stop-losses.

I’m Praveen Kumar, a seasoned Technical Analyst and stock market trader with over 25 years of experience in the Indian equity and derivatives markets. My passion for numbers and patterns led me to a dual career as a Mathematics Teacher and market technician. I specialize in Technical Analysis, with deep expertise in Elliott Wave Theory, derivatives strategies, and market forecasting. Over the years, my analysis and market views have been featured on NDTV Profit as a financial guest, along with published articles on reputed financial web portals, sharing insights on Nifty 50, Bank Nifty, and stock market trends. As a trader and analyst, I focus on interpreting price action, chart patterns, wave counts, and technical indicators to deliver precise market levels and actionable trade ideas. My approach blends classical charting with modern analysis tools to help traders navigate market volatility. Through VieCapital, I aim to share daily market analysis, trading strategies, and educatio…
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