Monday's trade setup; technical signals Nifty 50 shows a bearish candlestick on the daily chart

Analysts anticipate that the Nifty 50 index may continue its downward movement, approaching the August low of 23,894, followed by the 200-day EMA at 23,455 in the upcoming sessions.

Current Market Sentiment:

On Friday, Nifty 50 closed below the 100-day EMA, ending near 24,200 with almost a 1% decline. This decline fulfilled the initial target of a Head and Shoulders pattern on October 25. Experts expect further southward movement, potentially hitting the August low of 23,894 and even the 200-day EMA at 23,455. Any potential rebounds toward 25,650 (10-day EMA) may face selling pressure due to the oversold RSI. A "sell on rally" strategy is suggested.

Key Data Points to Note for Monday's Session:

Nifty 50 Key Levels

Resistance (pivot points): 24,372, 24,458, and 24,598

Support (pivot points): 24,092, 24,005, and 23,865

Technical Signals: Nifty 50 shows a bearish candlestick on the daily chart, marking a fourth day of lower highs and lows with above-average volumes. The RSI dropped below 30, indicating oversold conditions, while the 20-day EMA fell under the 50-day EMA, further signaling bearishness.

Bank Nifty Key Levels

Resistance (pivot points): 51,318, 51,582, and 52,009

Support (pivot points): 50,463, 50,199, and 49,771

Technical Signals: Bank Nifty closed below 51,000 with a 1.4% decline, forming a bearish candlestick. Breaking a rising trendline support may push it towards the 200-day EMA. For the week, it showed a Bearish Engulfing pattern, falling below short-term EMAs.

Nifty Call Options Data

Maximum Open Interest: 25,000 strike (1.08 crore contracts) as a key resistance

Call Writing: Most active at the 25,000 strike, with significant additions at the 24,300 and 24,200 strikes.

Nifty Put Options Data

Maximum Open Interest: 23,000 strike (77.22 lakh contracts), likely acting as key support

Put Writing: Strong at the 23,000 strike, indicating a solid base.

Bank Nifty Call Options Data

Key Resistance: 51,500 strike (30.07 lakh contracts)

Call Writing: Concentrated at 51,500 and 51,000 strikes.

Bank Nifty Put Options Data

Key Support: 50,000 strike (19.83 lakh contracts)

Put Writing: Strongest at the 49,500 strike.

Funds Flow (Rs Crore): Significant inflows or outflows are expected to impact market direction.

Put-Call Ratio (PCR)

Current Nifty PCR is at 0.87, reflecting a shift to bearish sentiment as selling in calls has picked up.

India VIX

India VIX spiked 4.74%, reaching 14.63, indicating heightened caution in the market.

Long Build-Up (14 Stocks)

Positive interest in 14 stocks with increasing prices and open interest.

Long Unwinding (92 Stocks)

Profit-taking in 92 stocks, shown by declining prices and open interest.

Short Build-Up (61 Stocks)

Increasing open interest alongside price declines in 61 stocks.

Short-Covering (17 Stocks)

17 stocks showed short-covering, with rising prices as traders closed short positions.

High Delivery Trades

Stocks showing a high share of delivery trades signal more investing interest than trading interest.

Stocks Under F&O Ban

Stocks newly banned: Dixon Technologies, IDFC First Bank, L&T Finance

Stocks retained in ban: Aarti Industries, Bandhan Bank, Escorts Kubota, IndiaMART InterMESH, Manappuram Finance, NMDC, RBL Bank

Stocks removed from ban: Indian Energy Exchange, Piramal Enterprises

Disclaimer: Investors should consult certified experts before making any investment decisions.