Will the Bulls Return or Is Another Breakdown Ahead?

 

📈 Nifty 50 Outlook: Will the Bulls Return or Is Another Breakdown Ahead?

Published on: July 30, 2025 

As we approach the final stretch of July, the Indian equity markets continue to face turbulent headwinds. On July 29, 2025, the Nifty 50 closed at 24,821.10, marginally higher amid intense volatility. But beneath this minor recovery lies a wave of concern—driven by sustained FII selling, weakening global markets, and increasing bearish bets in derivatives.

Let’s break down what the numbers say and where Nifty 50 could head next.

🔍 Derivatives Data: FII Bearishness Deepens

A close analysis of participant-wise positions shows that Foreign Institutional Investors (FIIs) are heavily net short in both index futures and options.

Segment FII Net Position Daily Change

Futures Index -170,684 contracts -43,526

Options Index -228,883 contracts -36,570

📉 What This Means:

FIIs are actively hedging or speculating on more downside.

Even PROs (proprietary traders) are showing limited directional conviction, closing some long positions.

Net options positioning reflects rising defensive setups—more puts, fewer calls.

📊 Price Action: Key Levels in Focus

Technically, Nifty is trading below its 20- and 50-day EMAs, hinting at short-term weakness. However, the index bounced from the critical support zone near 24,570, showing some signs of consolidation.

📌 Important Levels:

Type Level

Resistance Zone 24,897 – 25,072

Key Support 24,570

Breakdown Level 24,322 / 24,211

Bullish Trigger Above 25,150

> 📌 Note: Watch for price rejection at resistance and sharp sell-offs if 24,570 is broken convincingly.

🌍 Global Cues: Trouble Brewing Worldwide?

Global Index 29 July Close Trend

Nasdaq 21,098.29 Sideways

Dow Jones 44,632.99 Lower Highs

S&P 500 6,045.26 Weak Support

The U.S. markets, which heavily influence sentiment in India, are showing fatigue. The Nasdaq and S&P 500 are struggling near crucial support levels, while the Dow looks particularly vulnerable.

🏦 FII vs DII: Tug-of-War in Cash Markets

Despite sharp sell off from FIIs, Domestic Institutional Investors (DIIs) continue to act as strong buyers.

Participant Net Cash Flow (29 July)

FIIs ₹ -5,980 Cr

DIIs ₹ +6,146 Cr

This absorption of FII outflows by DIIs is preventing major breakdowns. However, sustained FII selling over the month (₹ -67,000 Cr cumulative) is a red flag for medium-term trends.

📉 Open Interest Trends: Sentiment Still Weak

On the Open Interest front (contracts held in derivatives), the trend shows:

FIIs: Heavily short

DIIs: Hedging through shorts despite equity buying

PROs: Neutral, unclear positioning

This suggests that institutional traders are preparing for either a breakdown or range-bound consolidation, not a sharp upward reversal yet.

🧭 Scenario Analysis: What Lies Ahead?

✅ Bullish Reversal (30% chance)

Triggers: Global recovery, FII short covering, strong earnings

Levels to watch: Close above 25,072, breakout towards 25,150–25,250

🔁 Sideways Movement (40% chance)

Nifty trades between 24,570–24,897 until catalysts emerge (Fed, macro data)

⚠️ Breakdown Risk (30% chance)

Below 24,570, Nifty could test 24,322 or even 24,211

Watch for aggressive FII shorts, global risk-off sentiment

💡 Strategy Corner: How Should You Position?

🔸 Traders:

Use intraday rallies near 24,897 to sell on strength. Only go long if Nifty gives a clean breakout above 25,072.

🔸 Investors:

Wait for deeper corrections toward 24,000 zones or sustained stability above 25,100 before fresh entries.

✅ Final Takeaway: Caution Over Conviction

Despite a temporary bounce, the underlying tone in Nifty remains weak. With global cues uncertain, FII flows negative, and technical resistances nearby, the market might remain range-bound to weak unless supported by strong triggers.

> Keep your radar tuned to 24,570–25,072 for directional bias. Watch U.S. markets, derivative shifts, and FII cash activity closely.

📢 Do you track market data like a pro?

Stay tuned to Indirect Tax India Online for real-time F&O sentiment, institutional flow updates, and global impact analysis – all in one place.

Anish Jagdish Parashar

Indirect tax india online research 

Disclaimer:Content reflects personal views of the author and for trading and investment purposes consult your financial advisor.

FII Shorts Deepen

 Nifty 50 Weekly Market Outlook – FII Shorts Deepen, Key Levels in Focus (28 July 2025)

📅 Published on: 28 July 2025

✍️ By: Indirect Tax India Online

📌 Highlights

Nifty 50 ends the week at 24,680.90, down 0.63%

FIIs intensify short positions in both Futures and Options

Critical support: 24,580 | Major resistance: 24,900–25,062

Divergence from global indices like NASDAQ, Dow Jones

Bearish undertone confirmed by technical indicators

📉 Nifty 50 – Snapshot & Sentiment Overview

This week, the Nifty 50 witnessed intensified selling pressure, closing below the 24,700 mark. Weakness in banking and financials, coupled with aggressive shorting by Foreign Institutional Investors (FIIs) in both index futures and options, has turned the sentiment firmly cautious.

Despite global equities showing strength, Indian markets continue to lag, largely due to domestic institutional selling, heavy derivative shorts, and technical weakness.

💼 Derivatives Market Pulse

🔄 F&O Positions – 28 July 2025

Segment Long Positions Short Positions Net

FII - Futures 33,986 198,714 -164,728 🔻

FII - Options Puts Long: 588,880 <br> Calls Long: 444,580 Calls Short: 522,244 <br> Puts Short: 346,635 Net: -319,909 🔻

DII Futures — — +22,674 📈

PRO Futures — — +15,217 📈

📌 Insight: FIIs are hedging aggressively, indicating a strong downside bias or heightened volatility expectations.

📊 Daily Variation in FII Derivatives Activity

Date Futures Variation Options Variation

28 Jul -10,390 🔻 -574,244 🔻

25 Jul -7,663 🔻 -528,052 🔻

24 Jul -7,263 🔻 -340,434 🔻

📉 The trend of relentless unwinding suggests a lack of bullish conviction among global participants.

🏦 Institutional Cash Flow – Equity Segment

Participant Gross Buy (₹ Cr) Gross Sell (₹ Cr) Net Flow

FII 13,660.48 15,079.92 -1,419.44 🔻

DII 10,238.00 (est.) 3,474.00 (est.) +6,764 📈

🔍 Interpretation: While domestic investors (DIIs) supported the market, it was not enough to absorb the sharp outflows from FIIs.

🌐 Global Markets Overview

Despite the Indian markets correcting, global cues remain broadly positive:

Index Close Week Change

NASDAQ 21,178.58 +2.8% 📈

Dow Jones 56,084.90 +1.2% 📈

S&P 500 6,045.26 +0.9% 📈

🧩 Key Divergence: India is seeing risk-off flows despite the global risk-on environment, indicating localised concern, possibly over valuations, earnings, or political cues.

🧠 Technical Analysis: Key Levels to Watch

Type Level Interpretation

Support 24,580 / 24,450 Breakdown can trigger sell-off to 24,200–24,000

Resistance 24,900 / 25,062 Only a breakout above this range negates bearish bias

RSI (14-day) 36.92 Approaching oversold territory

DMI +DI: 16.18, -DI: 17.02 Bearish crossover active

📉 The price is now trading below VWAP, 50 EMA and 200 EMA, all indicating a continuation of the downtrend unless a strong reversal emerges.

🧭 Scenarios Ahead: Bullish vs Bearish Outlook

✅ Bullish Case (Less Likely)

Needs FII short covering

Nifty to break above 25,062 with strong volume

Global cues remain positive and DIIs absorb supply

Upside Targets: 25,312 → 25,500 → 25,762

⚠️ Bearish Case (More Likely)

Sustained FII shorting

Breakdown below 24,580

Banking weakness to drag broader indices

Downside Targets: 24,450 → 24,200 → 23,950

🎯 Strategy for Traders & Investors

🔄 Short-term traders: Stick to sell-on-rise near resistance zones (24,767–24,900)

🛡️ Risk Management: Avoid leveraged positions; maintain strict SLs

📉 Options strategy: Consider 24,500 PE and 25,000 CE strangle due to volatility

🔎 Institutional Tracking: Watch for reversal signs in FII futures/net options, not price alone

🔚 Conclusion: Market at a Tipping Point

The current structure indicates that Nifty 50 is vulnerable to more downside, unless global cues trigger sharp reversals in FII positioning and cash flows. Watch 24,580 as the line in the sand for bulls. A breach could bring 24,200–24,000 in play.

Until FII sentiment reverses, adopt caution, protect profits, and focus on capital preservation.

📬 Subscribe to Indirect Tax India Online for daily sentiment analysis, institutional flow breakdowns, and strategic level-based trading insights.

💬 Feel free to comment your view on the market!

Anish Jagdish Parashar 

Indirect tax india online research 

Disclaimer:Content reflects personal views of the author and for trading and investment purposes consult your financial advisor.

Will the Index Find Support in the 24,700 Zone?

 Nifty 50 Market Outlook: Will the Index Find Support in the 24,700 Zone?

Date: July 28, 2025

Category: Stock Market Insights | Derivatives & Technical Analysis

🔍 Overview: Market Weakness Continues Amid Heavy FII Selling

Nifty 50 ended at 24,837 on July 25, 2025, closing well below key resistance levels and signaling potential continuation of the downward trend. A powerful combination of FII shorting in futures, aggressive call writing by PROs, and a sharp ₹3,201 Cr outflow from FII cash suggests that the bears are in control.

The index is now approaching a critical support zone—what I call the “Buy Zone” between 24,704 and 24,551—where a bounce or short-covering may trigger.

📊 Derivatives Data Breakdown: Futures & Options Indicate Pressure

💼 Futures Index Net Positions:

Market Participant Net Contracts Bias

FII –158,520 Strongly Bearish

PRO +17,396 Hedged Longs

DII +24,677 Contrarian Buying

📌 Key Insight: FIIs have offloaded aggressively in index futures, while DIIs are cautiously adding long positions.

🧨 Options Index Net Positions:

Participant Net Option Position Inference

FII –262,313 Heavy Call Writing

PRO –265,739 Bearish Bet Continuation

Both PROs and FIIs are heavily net short in index options, suggesting Nifty is unlikely to break above 25,010–25,100 in the short term.

🌐 Global Markets: Weak Cues Reinforce Domestic Selling

Global Index Weekly Trend Impact

Nasdaq Negative Drag on tech-heavy segments

Dow Jones Weak Global risk-off theme

S&P 500 Downtrend Reinforces FII outflows

Nifty Bank 56,528 Close Financials under pressure

🛑 Takeaway: All major global indices show weakness. With the USD-INR at 86.33, foreign investors are staying away.

💸 Institutional Flow Snapshot (July 25, 2025)

FII Net Outflow: ₹3,201 Cr (~$371 Million)

DII Cumulative Inflow (5 Days): ₹8,000+ Cr

✔️ DIIs continue to accumulate on dips.

📉 Nifty Technical Levels to Watch

Zone Range Significance

Resistance 25,010–25,090 Heavy Call OI

Central Pivot (TC) 24,959 Breakdown Confirmed

Buy Zone 24,704–24,551 Key Support Area

Reversal Level 25,163 Only above this, bulls regain control

🧠 What Can Traders Expect Next?

✅ Probable Bearish Continuation:

Target 1: 24,755

Target 2: 24,704–24,551

Break Below 24,551: Could open gates to 24,400–24,250

🔁 Alternate Scenario - Bounce Possible If:

Short covering kicks in from Buy Zone

Global markets stabilize

FIIs ease their selling spree

📌 Trading Strategy Suggestions

Intraday Traders: Short near 24,908–24,959 zone with stop-loss above 25,010

Positional Traders: Wait for confirmation bounce at 24,704–24,551 zone

Options Strategy: Bear Put Spreads or Short Call Spreads (25,100 CE and above)

✍️ Conclusion: Nifty At a Decisive Juncture

All signs—FII flows, derivative positioning, global cues, and technical structure—point to continued pressure on Nifty 50. However, the Buy Zone (24,704–24,551) is a critical area to watch for any reversal or relief rally. A break below this zone can escalate downside momentum.

📍 Stay tuned for live updates and follow-up analysis. Bookmark this space on Indirect Tax India Online for real-time derivative market strategies and Nifty trade setup.

> 💬 Comment below: Are you positioning for a bounce or a breakdown this week?

Anish Jagdish Parashar 

Indirect tax india online research 

Analysis of Nifty 50 Probable Movement

 Below is a professional analysis of the probable movement and critical levels for the Nifty 50 index based on the basis of open interest (OI) data, futures, options, and FII/DII activity. The analysis integrates market sentiment, technical levels, and derivative positioning to forecast near-term price action as of July 25, 2025.

Analysis of Nifty 50 Probable Movement and Critical Levels

1. Open Interest and Futures Data Analysis

The provided data shows participant-wise open interest and daily trends in futures and options for the Nifty 50 index, along with FII, DII, and proprietary (Pro) positioning. Key observations:

FII Activity:

FIIs hold a net short position in futures index contracts (-158,520 contracts) and a significant net short position in index options (-262,313 contracts) as of July 25, 2025.

Daily futures variation shows FIIs reducing short positions slightly (-7,663 contracts), but the cumulative short bias remains strong, indicating bearish sentiment.

FIIs’ net selling in the cash market (-₹1,995.5 crore) reinforces their cautious-to-bearish outlook.

DII Activity:

DIIs maintain a net long position in futures (+24,677 contracts), acting as a counterforce to FII selling. This suggests domestic institutions are absorbing selling pressure, supporting the index at lower levels.

However, their relatively smaller position size compared to FIIs limits their ability to drive significant bullish momentum.

Proprietary Traders (Pro):

Pros hold a net long position in futures (+17,396 contracts) but a net short position in options (-265,739 contracts). This mixed positioning indicates Pros may be hedging or betting on range-bound movement with a bearish tilt in options.

Cumulative OI Trends:

The cumulative futures index net OI has grown increasingly negative (-116,447 contracts), reflecting sustained bearish positioning by FIIs over the period.

Option index net OI is also heavily negative (-528,052 contracts), with a significant increase in put writing, suggesting expectations of downside protection or consolidation.

2. Option Chain Insights

Option OI Distribution:

The option index data shows higher put OI (3,036,165 contracts) compared to call OI (4,280,581 contracts), with Pros and FIIs heavily short on calls and puts. This indicates a market expecting limited upside in the near term, with put writers defending lower levels.

Key strike levels with high OI (not explicitly provided but inferred):

Support: Likely concentrated at 24,500–24,700, where put OI is typically heavy, acting as a strong demand zone.

Resistance: Likely at 25,000–25,200, where call OI is significant, capping upward moves.

Put-Call Ratio (PCR):

The PCR (put OI ÷ call OI) is approximately 0.71 (3,036,165 ÷ 4,280,581), signaling bearish sentiment as put writing dominates. A PCR below 1 typically indicates caution or bearishness.

3. Price Action and Technical Levels

Nifty 50 Closing Price: The index closed at 24,837 on July 25, 2025, down from its recent high of 25,637.8 on June 27, 2025, reflecting a correction of ~3.1%.

Trend Analysis:

The Nifty 50 has been in a consolidation phase, with a downward bias over the last month, as evidenced by lower highs and lower lows (e.g., 25,637 on June 27 to 24,837 on July 25).

The index is trading below its 20-day moving average (~25,100) and approaching the 50-day moving average (~24,700), a critical support level.

Key Levels:

Support:

24,700: Coincides with the 50-day moving average and high put OI, making it a strong demand zone.

24,500: A psychological level with potential for increased put buying if breached.

Resistance:

25,000: A psychological and technical resistance with significant call OI.

25,200: Likely to see heavy selling pressure due to FII short positions and call writing.

4. Global Market Context

US Indices:

The NASDAQ Composite (19,662.49), Dow Jones (42,967.62), and S&P 500 (6,045.26) on June 12, 2025, indicate a mixed global sentiment. The NASDAQ and S&P 500 have shown resilience, while the Dow has been range-bound.

A stronger US market could provide some support to global risk sentiment, but FII outflows from India (-$231.15 million net equity investment) suggest capital is rotating away from emerging markets like India.

Nifty Bank Index:

The Nifty Bank index closed at 56,528.9, also in a corrective phase from its high of 57,443.9 on June 27, 2025. Its movement often correlates with the Nifty 50, reinforcing the broader market’s cautious outlook.

5. Probable Movement

Based on the OI data, FII/DII positioning, and technical levels, the Nifty 50 is likely to exhibit the following behavior in the near term (next 1–2 weeks):

Bearish Bias with Consolidation:

FIIs’ heavy short positions in futures and options, combined with net selling in the cash market, suggest continued downward pressure. The index may test the 24,700–24,500 support zone, where DII buying and put writing could stabilize prices.

A break below 24,500 could trigger further selling toward 24,200–24,300, especially if global risk-off sentiment intensifies.

Range-Bound Scenario:

If the 24,700 support holds, the index could consolidate between 24,700 and 25,000, with volatility driven by option expiry dynamics and FII unwinding of short positions.

A breakout above 25,000 would require significant DII buying or a reversal in FII sentiment, which seems unlikely given current data.

Upside Capped:

Resistance at 25,000–25,200 is likely to hold due to heavy call OI and FII short positions. A sustained move above 25,200 would require strong global cues or a shift in FII positioning to net long.

6. Critical Levels to Watch

Immediate Support: 24,700 (50-DMA, high put OI)

Strong Support: 24,500 (psychological, demand zone)

Immediate Resistance: 25,000 (psychological, high call OI)

Strong Resistance: 25,200 (technical resistance, FII short pressure)

Breakout Trigger:

Above 25,200: Bullish momentum toward 25,500–25,600.

Below 24,500: Bearish breakdown toward 24,200–24,300.

7. Recommendations

Traders:

Short-Term: Consider bearish strategies (e.g., put buying or call writing) near 25,000, with a stop-loss above 25,200. Alternatively, buy puts at 24,700 for downside protection.

Hedging: Use 24,500 puts and 25,000 calls for a range-bound strategy.

Investors:

Accumulate quality stocks on dips near 24,500–24,700, as DII buying may provide support. Avoid aggressive long positions until FII selling subsides.

Monitor:

FII activity for signs of short covering.

Global cues, especially US indices and FII flows.

Option OI shifts ahead of the weekly/monthly expiry.

8. Conclusion

The Nifty 50 is likely to remain under pressure with a bearish bias, driven by FII short positions and net selling in the cash market. The 24,700–24,500 range is a critical support zone, supported by DII buying and put OI, while 25,000–25,200 acts as a strong resistance. Traders should prepare for volatility within this range, with a potential downside test if global or domestic sentiment worsens. A breakout above 25,200 or below 24,500 will define the next directional move.

Disclaimer: This analysis is based on the provided data and general market principles. It is not financial advice. Consult a certified financial advisor before making investment decisions.

Sources:

National Stock Exchange (NSE) data

Central Depository Services (India) Limited (CDSL) FII/FPI data

Anish Parashar 

Indirect tax india research 

Nifty 50 Probable Movement

 

Nifty 50 Probable Movement and Critical Levels Based on Open Interest Data (July 24, 2025)

This analysis leverages open interest (OI) data, futures and options positioning, and FII/DII activity to forecast the probable movement of the Nifty 50 index and identify critical support and resistance levels. The data provided includes participant-wise OI, daily FII/DII investments, and index closing prices as of July 24, 2025. The analysis indicates a bearish bias in the near term due to significant FII selling in futures and options, with key support and resistance levels identified based on OI concentration and price action.

1. Market Context and Data Overview

The Nifty 50 index closed at 25,062.1 on July 24, 2025, reflecting a decline of 157.8 points (-0.63%) from the previous day. The Nifty Bank index also fell, closing at 57,066.05 (-144.4 points, -0.25%). Global indices showed mixed performance, with the Nasdaq Composite declining to 21,057.96 (-0.18%) and the Dow Jones to 44,693.91 (-0.71%), while the S&P 500 remained relatively flat at 6,358.91 (+0.78% over recent sessions).

Key observations from the provided data:

FII Activity: FIIs have maintained a net bearish stance in index futures (net -145,538 contracts) and options (net -165,910 contracts) as of July 24, 2025. Their gross sales in equity markets (₹18,781.7 crore) significantly outpaced purchases (₹15,405.02 crore), resulting in a net outflow of ₹3,376.68 crore.

DII Activity: DIIs hold a net long position in index futures (+28,255 contracts), acting as a counterbalance to FII selling but with limited impact due to lower volumes.

Pro Activity: Proprietary traders (Pro) show a net long position in futures (+8,499 contracts) but a significant net short position in options (-174,524 contracts), suggesting a hedging strategy or bearish outlook.

Options OI: High OI concentrations in call and put options indicate key levels of support and resistance, with notable activity in the 24,500–25,500 strike range for calls and 24,000–24,500 for puts.

2. Technical and OI-Based Analysis

2.1 Open Interest Analysis

Index Futures:

FIIs’ consistent selling in futures (cumulative net -108,784 contracts as of July 24) reflects strong bearish sentiment. The daily variation shows FIIs reducing short positions slightly (-7,263 contracts), but the overall trend remains bearish.

DIIs’ net long position (+28,255 contracts) and marginal buying (+28,255 contracts) suggest they are absorbing FII selling, potentially stabilizing the market at lower levels.

Pro traders’ net long position (+8,499 contracts) indicates selective buying, possibly at perceived support levels.

Index Options:

High OI in call options at 25,000–25,500 strikes (FII call short OI: 310,417 contracts) suggests strong resistance in this zone. Significant put OI at 24,000–24,500 strikes (FII put long OI: 456,262 contracts) indicates potential support.

The put-call ratio (PCR) based on OI is approximately 0.89 (2,688,606 put contracts vs. 3,022,103 call contracts), signaling mild bearish sentiment as call writing dominates.

Pro traders’ heavy shorting in both calls (744,046 contracts) and puts (608,571 contracts) suggests a market-neutral or volatility-based strategy, likely profiting from range-bound movement.

2.2 Price Action and Trends

The Nifty 50 has been consolidating between 24,700 and 25,600 over the past month, with recent sessions showing increased selling pressure. The index’s failure to sustain above 25,200 (July 10–11, 2025) and the subsequent drop below 25,100 reinforce bearish momentum.

The Nifty Bank index, closely correlated with Nifty 50, shows similar consolidation between 55,500 and 57,500, with recent weakness indicating potential for further downside.

Global indices’ mixed performance (Nasdaq and Dow declining, S&P 500 stable) suggests cautious sentiment, with no strong bullish catalyst to support Indian indices in the near term.

3. Probable Movement

Based on the OI data, FII/DII activity, and price trends, the Nifty 50 is likely to exhibit the following behavior in the near term (1–2 weeks):

Bearish Bias: FIIs’ aggressive selling in futures and options, coupled with net equity outflows (₹3,722.53 crore total), suggests continued downward pressure. The high OI in 25,000–25,500 call strikes reinforces resistance, making a sustained breakout above 25,500 unlikely without significant positive triggers.

Range-Bound Consolidation: The high put OI at 24,000–24,500 strikes, combined with DII buying in futures, indicates strong support in this zone. A sharp decline below 24,500 is possible but may be met with buying interest from DIIs and retail investors.

Volatility Outlook: The heavy shorting by proprietary traders in both calls and puts suggests expectations of heightened volatility, potentially driven by global cues or domestic events (e.g., upcoming earnings or policy announcements).

3.1 Scenarios

Bearish Scenario (Probability: 60%):

If FII selling persists and global indices continue to weaken, the Nifty 50 could test support at 24,500–24,700. A break below 24,500 may trigger further downside toward 24,000, a psychologically significant level with high put OI.

Key trigger: Sustained FII outflows and negative global cues (e.g., Nasdaq/Dow falling below 20,500/44,000).

Bullish Scenario (Probability: 25%):

A reversal in FII positioning (e.g., short covering in futures or reduced call writing) or strong DII buying could push the index toward 25,500–25,600. A breakout above 25,600 would signal a bullish trend, potentially targeting 26,000.

Key trigger: Positive global cues (e.g., S&P 500 breaking above 6,400) or domestic policy support.

Neutral Scenario (Probability: 15%):

The index may consolidate between 24,700 and 25,300, with high OI at these levels acting as support and resistance. This scenario is likely if FII selling slows and DIIs continue to absorb supply.

Key trigger: Lack of significant catalysts in global or domestic markets.

4. Critical Levels

Based on OI concentration, price action, and historical support/resistance, the following levels are critical for the Nifty 50:

Support Levels:

24,700: Strong put OI and recent price consolidation make this a key support. DII buying is likely to intensify here.

24,500: Psychologically significant level with high put OI (456,262 FII put long contracts). A break below this could accelerate selling.

24,000: Major support with potential for strong buying interest from DIIs and retail investors.

Resistance Levels:

25,200: Immediate resistance, tested multiple times in July (e.g., July 10–11, 2025). High call OI (310,417 FII call short contracts) strengthens this barrier.

25,500: Strong resistance due to heavy call writing and recent price rejection (July 9–10, 2025).

25,600–25,800: Major resistance zone, with a breakout requiring significant FII short covering or positive global cues.

5. Recommendations

Traders:

Short-Term (Intraday/Swing): Consider bearish strategies (e.g., put buying or call writing) near 25,200–25,500, with strict stop-losses above 25,600. On the downside, look for buying opportunities near 24,700–24,500.

Options Strategy: A bear put spread (buy 24,700 put, sell 24,500 put) or a short straddle at 25,000 (for volatility-focused traders) could be effective given the high OI and expected range-bound movement.

Investors:

Monitor FII activity closely. Sustained selling may provide opportunities to accumulate quality stocks at lower levels (e.g., near 24,500).

Focus on defensive sectors (e.g., FMCG, Pharma) if bearish momentum persists, as these are less sensitive to FII outflows.

Risk Management:

Maintain strict stop-losses due to potential volatility from global cues or FII positioning changes.

Watch for sudden shifts in OI (e.g., FII short covering or DII selling) as early indicators of trend reversals.

6. Conclusion

The Nifty 50 is poised for a near-term bearish move, driven by FII selling in futures and options, with key support at 24,700–24,500 and resistance at 25,200–25,500. High OI in both calls and puts suggests a range-bound market with potential for increased volatility. Traders should focus on short-term opportunities near critical levels, while investors should await stabilization near support zones for accumulation. Monitoring FII/DII flows and global indices will be crucial for anticipating trend changes.

Disclaimer: This analysis is based on the provided data and general market principles. Actual market movements may vary due to unforeseen events or changes in participant behavior. Always conduct independent research and consult a financial advisor before making investment decisions.

Source: National Stock Exchange (NSE), participant-wise OI data, FII/DII investment trends as of July 24, 2025.

Anish Jagdish Parashar 

Indirect tax india research 

Nifty 50 Probable Movement and Critical Levels

 

Nifty 50 Probable Movement and Critical Levels Based on Open Interest Data (as of July 23, 2025)

This analysis examines the probable movement of the Nifty 50 index based on open interest (OI) data, FII/DII activity, and global market trends as of July 23, 2025. The Nifty 50 closed at 25,219.9, reflecting a cautious market sentiment amid mixed signals from futures and options data, foreign institutional investor (FII) activity, and global indices (Nasdaq, Dow Jones, S&P 500). Key support and resistance levels are identified, and a short-term outlook is provided to guide traders and investors.

1. Open Interest Analysis

The provided OI data for futures and options, combined with FII/DII activity, offers critical insights into market positioning and sentiment.

1.1 Futures Open Interest

FIIs: Net short with -145,557 contracts in index futures (32171 long vs. 177728 short), indicating bearish sentiment. This is consistent with a cumulative net short position of -101,521 contracts as of July 23, 2025.

DIIs: Net long with 33,796 contracts, acting as a counterbalance to FII selling pressure. However, their long positions are significantly smaller than FII shorts, suggesting limited bullish conviction.

Proprietary Traders (Pro): Modestly net long with 10,240 contracts, indicating a neutral-to-bullish stance but with limited conviction.

Daily Variation: FIIs reduced their short positions by 3,576 contracts, while DIIs increased longs by 320,174 contracts, suggesting some short covering and fresh long buildup.

1.2 Options Open Interest

FIIs: Net short in index options with -119,347 contracts (418,425 call long, 540,459 put long vs. 402,265 call short, 404,952 put short). The higher put long positions suggest hedging or bearish bets.

Proprietary Traders: Net long with 62,558 contracts, driven by significant call long positions (1,100,090) and put long positions (1,279,789). This indicates speculative bullish positions but with hedging via puts.

Cumulative Option OI: The cumulative net OI in index options is -56,789, reflecting a bearish tilt in the options market.

Key Strike Levels:

Highest Call OI: Likely concentrated around 25,500–26,000, indicating strong resistance.

Highest Put OI: Likely around 25,000–24,500, suggesting strong support.

The put-call ratio (PCR) is not explicitly provided but can be inferred as slightly bearish due to higher put OI, signaling caution or downside protection.

1.3 Interpretation

FII Selling Pressure: FIIs’ consistent short positions in futures and options suggest a bearish outlook, possibly driven by global market cues or profit booking after the Nifty 50’s rally to 25,219.9.

DII Counterbalance: DIIs’ long positions provide some support, but their limited scale may not fully offset FII selling.

Options Hedging: The heavy put OI indicates market participants are bracing for potential downside, while call OI at higher strikes suggests capped upside in the near term.

2. Price Movement and Technical Levels

The Nifty 50 closed at 25,219.9 on July 23, 2025, up from 25,060.9 the previous day, reflecting a modest recovery. However, the index has been volatile, as evidenced by the range between 24,620 (June 4, 2025) and 25,637.8 (June 27, 2025).

2.1 Critical Support Levels

Immediate Support: 25,000–25,100

Supported by high put OI and recent price action, where the index bounced from 25,060.9 (July 22, 2025).

A break below 25,000 could trigger selling toward 24,800–24,700, aligning with the 50-day moving average (DMA) and higher put OI.

Strong Support: 24,500–24,600

This zone corresponds to the 100-DMA and significant put OI, acting as a major demand zone.

A breach below 24,500 could lead to a deeper correction toward 24,000, a psychological and technical support level.

2.2 Critical Resistance Levels

Immediate Resistance: 25,500–25,600

High call OI and the recent high of 25,637.8 (June 27, 2025) make this a formidable barrier.

A breakout above 25,600 would require strong FII buying or positive global cues.

Major Resistance: 26,000

A psychological level with likely heavy call OI, acting as a ceiling for bullish momentum in the near term.

2.3 Trend Analysis

The Nifty 50 is in a short-term consolidation phase, trading within a 24,500–25,600 range.

The 50-DMA (approx. 24,800) and 200-DMA (approx. 23,500, not tested recently) provide structural support.

Momentum indicators (e.g., RSI, not provided but inferred) are likely in the neutral zone (40–60), suggesting neither overbought nor oversold conditions.

3. FII/DII Investment Trends

FII Equity Investments (July 23, 2025):

Net investment: +4,618.07 crores (gross purchases: 21,686.24 crores; gross sales: 17,068.17 crores).

Positive net investment in the cash market contrasts with their bearish futures and options positions, suggesting selective buying in quality stocks or primary market activity.

DII Activity: Not explicitly detailed in cash market data, but their long futures positions indicate domestic support for the market.

Implications: FIIs’ cash market buying may stabilize the index, but their short positions in derivatives suggest caution or hedging against global uncertainties.

4. Global Market Context

Nasdaq Composite: Declined from 21,020.02 (July 22, 2025) to an unspecified level on July 23, 2025, indicating tech sector weakness.

Dow Jones: Rose from 44,502.44 (July 22, 2025) to 45,010.29 (July 23, 2025), reflecting resilience in blue-chip stocks.

S&P 500: Marginally up from 6,309.62 (July 22, 2025) to an unspecified level, suggesting mixed global sentiment.

Implications: The Nasdaq’s weakness may pressure IT-heavy Nifty 50 constituents, while Dow’s strength could support banking and industrial stocks. Global volatility (VIX not provided but assumed elevated) may cap Nifty’s upside.

5. Probable Movement and Scenarios

Based on the OI data, price action, and global cues, the Nifty 50’s short-term movement (next 1–2 weeks) can be outlined as follows:

5.1 Bullish Scenario

Trigger: Strong FII buying in cash markets continues, coupled with short covering in futures (FIIs reducing short OI).

Target: Breakout above 25,600, aiming for 26,000–26,200.

Catalysts: Positive global cues (e.g., US Fed rate cut signals, Nasdaq recovery) or robust domestic earnings.

Probability: Moderate (30%), given FIIs’ bearish derivative positions and global volatility.

5.2 Bearish Scenario

Trigger: FIIs increase short positions or global markets (Nasdaq, S&P 500) decline sharply.

Target: Fall toward 24,800–24,500, with a potential deeper correction to 24,000 if 24,500 breaks.

Catalysts: Global risk-off sentiment, rising US bond yields, or weak domestic earnings.

Probability: High (50%), due to FIIs’ net short positions and heavy put OI.

5.3 Sideways Scenario

Trigger: Lack of decisive FII/DII activity and mixed global cues.

Range: 24,800–25,600, with 25,000 acting as a pivot.

Catalysts: Absence of major macroeconomic or earnings triggers.

Probability: Moderate (20%), as the market awaits clearer directional cues.

6. Critical Levels and Trading Strategy

Support Zone: 25,000–24,800 (immediate), 24,500–24,600 (strong).

Resistance Zone: 25,500–25,600 (immediate), 26,000 (major).

Trading Strategy:

Long Setup: Buy near 25,000–24,800 with a stop-loss below 24,700, targeting 25,500–25,600.

Short Setup: Sell near 25,500–25,600 with a stop-loss above 25,700, targeting 25,000–24,800.

Options Strategy: Consider a bear put spread (buy 25,000 put, sell 24,500 put) for downside protection or a straddle at 25,000 for volatility plays.

7. Conclusion

The Nifty 50 is likely to remain range-bound between 24,800 and 25,600 in the near term, with a bearish bias due to FIIs’ net short positions in futures (-145,557 contracts) and options (-119,347 contracts). However, DII buying and selective FII cash market investments provide support. Critical levels to watch are 25,000 (support) and 25,600 (resistance). Traders should monitor FII activity, global market trends, and upcoming domestic earnings for directional cues.

8. Disclaimer

This analysis is based on the provided data and general market principles. It is for informational purposes only and does not constitute financial advice. Investors and traders should conduct their own research and consult financial advisors before making decisions.

Sources: NSE, Central Depository Services (India) Limited, provided dataset.

Anish Jagdish Parashar 

Indirect tax india research 

Nifty 50: Probable Movement

 

Nifty 50: Probable Movement and Critical Levels (as of July 22, 2025)

1. Market Context and Price Action

Nifty 50 Closing Price (July 22, 2025): 25,060.9

Recent Trend: The Nifty 50 has shown volatility, declining from a high of 25,637.8 on June 27, 2025, to 25,060.9 on July 22, 2025, a drop of approximately 2.25% over the period. The index has been consolidating between 24,700 and 25,600, with intermittent pullbacks.

Global Indices:

NASDAQ Composite: Declined from 20,973.46 (June 27) to 20,892.69 (July 22), signaling caution in global tech-heavy markets.

Dow Jones: Increased from 42,206.82 (June 20) to 44,502.44 (July 22), indicating resilience in broader U.S. markets.

S&P 500: Rose from 5,967.84 (June 20) to 6,305.6 (July 21), reflecting bullish sentiment in U.S. equities.

The mixed global cues suggest selective sector strength, with Indian markets potentially influenced by U.S. market resilience but cautious due to tech sector weakness.

2. Open Interest Analysis

a. Futures Open Interest (Participant-Wise, July 22, 2025)

FIIs: Net short with -149,454 contracts (Future Index Long: 30,254; Short: 179,708). This indicates strong bearish positioning by FIIs, likely hedging or anticipating a correction.

DIIs: Net long with 36,280 contracts (Long: 65,840; Short: 29,560). DIIs are countering FII selling, providing support to the market.

Proprietary Traders (Pro): Net long with 15,229 contracts (Long: 43,873; Short: 28,644), aligning with DIIs but with less conviction.

Cumulative FII Futures Trend (July 1–22): FIIs have consistently increased short positions, with net futures OI moving from -38,123 (June 30) to -149,454 (July 22), reflecting growing bearish sentiment.

b. Options Open Interest (July 22, 2025)

FIIs: Net short in options with -197,860 contracts (Call Long: 404,137; Put Long: 528,219; Call Short: 424,169; Put Short: 350,391). FIIs have a higher put long position, suggesting hedging against downside risk.

Pro Traders: Net short in options with -179,103 contracts (Call Long: 1,097,819; Put Long: 1,080,196; Call Short: 1,060,528; Put Short: 863,802). The balanced call/put OI indicates neutral-to-bearish positioning.

Option Index Net Cumulative: The cumulative option OI has shifted from +103,544 (June 30) to -376,963 (July 22), signaling a buildup of bearish sentiment in the options market.

Key Strike Levels (based on typical OI concentration):

Support (Put OI Concentration): Likely around 24,500–24,700, where significant put writing is expected, acting as a floor.

Resistance (Call OI Concentration): Likely around 25,300–25,500, where call writing is prominent, capping upside moves.

c. Daily Variations

FII Futures Variation (July 22): -2,124 contracts, indicating continued short buildup.

DII Futures Variation (July 22): -190,156 contracts, a sharp reduction in long positions, suggesting profit booking or reduced bullish conviction.

Options Variation (July 22): FIIs reduced option positions by -44,769 contracts, while Pros reduced by -145,387, indicating unwinding of positions, possibly due to expiry-related adjustments.

3. FII Investment Trends (July 22, 2025)

Equity Market (Stock Exchange): FIIs sold ₹12,852.97 crore and bought ₹11,761.69 crore, resulting in a net outflow of ₹1,091.28 crore (US$ -126.56 million). This aligns with the bearish futures and options positioning.

Debt and Hybrid Markets: Net outflows in debt (₹-77.1 crore) and hybrid (₹-27.42 crore) segments indicate a cautious approach across asset classes.

4. Technical Levels and Probable Movement

Based on the OI data, price action, and FII/DII activity, the following critical levels and probable movements are derived:

Support Levels:

24,700–24,800: Strong put OI concentration and historical support from mid-June levels (24,718.6 on June 13).

24,500: Psychological and technical support, reinforced by high put OI.

Resistance Levels:

25,300–25,400: Significant call OI buildup, likely to act as a near-term ceiling.

25,600: Recent high (June 27) and a major resistance zone.

Probable Movement:

Bearish Bias (Short-Term): The heavy FII short positions in futures (-149,454 contracts) and options (-197,860 contracts), coupled with net equity outflows, suggest downward pressure. The Nifty 50 may test 24,700–24,800 in the near term if selling intensifies.

Potential Rebound: DIIs’ net long futures position (36,280 contracts) and historical buying at lower levels (e.g., 24,718 on June 13) indicate potential support around 24,700, which could trigger a bounce toward 25,200–25,300 if global cues remain stable.

Volatility Outlook: The high cumulative option OI (-376,963) and unwinding of positions suggest elevated volatility, especially near expiry. The index is likely to consolidate between 24,700 and 25,300 until a clear breakout catalyst emerges.

5. Key Scenarios and Trading Strategy

Bearish Scenario (Break below 24,700):

Trigger: Increased FII selling and global market weakness (e.g., NASDAQ further declining below 20,800).

Target: 24,500 (next major support).

Strategy: Short futures or buy 24,700/24,500 puts with a stop-loss above 25,000.

Bullish Scenario (Break above 25,300):

Trigger: DII buying intensifies, FIIs cover shorts, or positive global cues (e.g., S&P 500 sustains above 6,300).

Target: 25,600–25,800.

Strategy: Buy 25,300/25,500 calls with a stop-loss below 24,900.

Neutral/Range-Bound Strategy:

Range: 24,700–25,300.

Strategy: Sell straddles/strangles at 25,000 or 25,200 strikes to capitalize on consolidation and time decay, with strict risk management.

6. Risk Factors

Global Markets: A sharp correction in U.S. indices (e.g., NASDAQ dropping below 20,500) could amplify FII selling.

FII Activity: Continued short buildup by FIIs could push the index toward 24,500.

Expiry Dynamics: High OI unwinding near expiry may lead to sharp intraday moves.

Macro Events: Monitor global macroeconomic data (e.g., U.S. Fed policy, India’s Q1 FY26 results) for directional cues.

7. Conclusion

The Nifty 50 is likely to remain range-bound between 24,700 and 25,300 in the near term, with a bearish tilt due to FII short positions and net equity outflows. Key support at 24,700 and resistance at 25,300 are critical levels to watch. Traders should adopt range-bound strategies while staying alert for breakout signals driven by FII/DII activity or global market trends.

Disclaimer: This analysis is based on the provided data and general market principles. Actual market movements may differ due to unforeseen events. Consult a financial advisor before making trading decisions.

Anish Jagdish Parashar 

Indirect tax india research 

Nifty 50 Probable Movement

 

Nifty 50 Probable Movement and Critical Levels Based on Open Interest Data (as of July 21, 2025)

This analysis examines the probable movement of the Nifty 50 index and identifies critical support and resistance levels using open interest (OI) data from futures and options, along with participant-wise positioning (DII, FII, Pro) as of July 21, 2025. By integrating futures and options OI, daily variations, and index closing prices, we derive insights into market sentiment, potential price trends, and key technical levels for traders and investors.

1.The Nifty 50 index, a benchmark for the Indian equity market, is influenced by the positioning of key market participants—Domestic Institutional Investors (DIIs), Foreign Institutional Investors (FIIs), and proprietary traders (Pro). Open interest data from futures and options provides a window into market sentiment, potential price direction, and critical levels of support and resistance. This paper analyzes the participant-wise OI data as of July 21, 2025, alongside recent index movements, to forecast probable Nifty 50 trends and identify critical levels for the near term.

2. Data Overview

The provided dataset includes:

Futures and Options OI: Participant-wise net positions in futures and options (DII, FII, Pro) as of July 21, 2025.

Daily Variations: Changes in futures and options OI, reflecting shifts in market positioning.

Index Closing Prices: Nifty 50 and Nifty Bank closing prices, alongside global indices (Nasdaq, Dow Jones, S&P 500) for context.

Nifty 50 Closing Price: 25,090.7 (July 21, 2025).

Participant-wise OI (July 21, 2025):

DII: Net long in futures (+37,199 contracts), neutral in options (minimal activity).

FII: Net short in futures (-145,244 contracts) and options (-153,091 contracts).

Pro: Net long in futures (+12,224 contracts), net short in options (-33,716 contracts).

Options OI Distribution: High OI in calls at 25,500–26,000 and puts at 24,500–25,000, indicating key resistance and support zones.

3. Market Sentiment Analysis

The OI data reveals distinct participant behaviors:

FIIs: Heavy short positioning in both futures (-145,244 contracts) and options (-153,091 contracts) suggests bearish sentiment. FIIs have consistently increased short positions in futures over the past weeks (from -38,123 on June 30 to -145,244 on July 21), indicating a lack of confidence in near-term upside.

DIIs: Net long in futures (+37,199 contracts) with minimal options activity suggests a defensive stance, likely hedging against FII selling pressure.

Proprietary Traders: Mixed positioning with a net long in futures (+12,224 contracts) but short in options (-33,716 contracts), indicating selective bullish bets in futures but cautious hedging in options.

The cumulative futures OI (-95,821 contracts) and options OI (-186,807 contracts) reflect a bearish bias, driven predominantly by FII shorting. However, the Nifty 50 index has remained range-bound between 24,800–25,600 over the past month, suggesting a tug-of-war between bullish DIIs and bearish FIIs.

4. Technical Analysis and Critical Levels

Using OI data and recent price action, we identify critical support and resistance levels for the Nifty 50.

4.1 Support Levels

24,800–24,900: Significant put OI is observed at the 24,800 and 25,000 strike levels, indicating strong support. The Nifty 50 has tested this zone multiple times (e.g., June 18 closing at 24,812.05) and bounced, reinforcing its importance.

24,500: High put OI accumulation at 24,500 suggests a secondary support level. A break below 24,800 could lead to a quick move toward 24,500, where put writers are likely to defend the level.

24,200: A psychological and technical support level, coinciding with the 50-day moving average (approximated based on recent closings).

4.2 Resistance Levels

25,500–25,600: Heavy call OI at 25,500 and 26,000 strikes indicates strong resistance. The Nifty 50 peaked at 25,649 (June 26) but failed to sustain above 25,500, aligning with high call writing by FIIs and Pros.

25,800: A breakout above 25,600 could target 25,800, but low OI at this level suggests limited immediate upside potential.

26,000: A major psychological and OI-heavy resistance, where call writers dominate.

4.3 Options OI Insights

Call OI Concentration: Highest at 25,500 (3.67 million contracts) and 26,000 (3.5 million contracts), indicating strong resistance due to call writing by FIIs.

Put OI Concentration: Highest at 25,000 (3.46 million contracts) and 24,800 (3.2 million contracts), suggesting robust support from put writers.

Put-Call Ratio (PCR): The PCR for Nifty 50 options is approximately 0.94 (3.46 million puts / 3.67 million calls), indicating a slightly bearish sentiment but close to neutral, suggesting consolidation.

5. Probable Movement

Based on the OI data and recent price action, the Nifty 50 is likely to remain range-bound in the near term, with a slight bearish bias due to FII shorting. The probable scenarios are:

Consolidation (Base Case, 60% Probability):

Range: 24,800–25,500.

Rationale: High OI at 24,800 (puts) and 25,500 (calls) suggests a range-bound market. The Nifty 50 has oscillated within this range since mid-June, with neither bulls nor bears gaining decisive control.

Trigger: Continued FII shorting offset by DII buying, maintaining equilibrium.

Bearish Breakdown (25% Probability):

Target: 24,500–24,200.

Rationale: A break below 24,800, driven by sustained FII selling and global market weakness (e.g., Nasdaq correction from 20,974.18 on July 21), could push the index toward 24,500, where put OI is significant.

Trigger: Negative global cues or increased FII shorting in futures.

Bullish Breakout (15% Probability):

Target: 25,800–26,000.

Rationale: A breakout above 25,500, supported by short covering by FIIs or fresh DII buying, could target 25,800–26,000. However, heavy call OI at 26,000 makes a sustained move unlikely.

Trigger: Positive global market cues or reduced FII shorting.

6. Global Context

Global indices provide additional context:

Nasdaq Composite: Declined from 20,611.34 (July 9) to 20,974.18 (July 21), indicating tech sector weakness, which may pressure FII sentiment in India.

Dow Jones: Rose from 42,240.76 (July 8) to 44,323.07 (July 21), reflecting resilience in broader U.S. markets.

S&P 500: Increased from 6,225.52 (July 8) to 6,263.7 (July 16), suggesting mixed global signals.

The mixed performance of global indices, particularly Nasdaq’s weakness, aligns with FIIs’ bearish positioning in Nifty 50 futures and options, reinforcing the consolidation or bearish breakdown scenarios.

7. Recommendations

Traders:

Range-Bound Strategy: Sell 25,500 calls and 24,800 puts (iron condor) to capitalize on consolidation, targeting premium decay.

Bearish Strategy: Buy 24,800 puts if the Nifty 50 breaks below 24,800, targeting 24,500.

Bullish Strategy: Buy 25,500 calls on a breakout above 25,500, targeting 25,800, with a stop below 25,400.

Investors:

Accumulate quality stocks on dips toward 24,800–24,500, as strong put OI suggests limited downside.

Avoid aggressive long positions until a breakout above 25,500 is confirmed.

Risk Management:

Monitor FII futures OI for signs of increased shorting or short covering.

Watch global indices, particularly Nasdaq, for cues on FII sentiment.

Set stop-losses below 24,800 (bearish) or above 25,500 (bullish) to manage breakout risks.

8. Conclusion

The Nifty 50 is likely to consolidate between 24,800 and 25,500 in the near term, with a slight bearish bias due to heavy FII shorting in futures and options. Critical support lies at 24,800 and 24,500, while resistance is at 25,500 and 26,000. Traders should adopt range-bound strategies, while investors can accumulate on dips, supported by strong put OI. Monitoring FII positioning and global market trends will be crucial for anticipating breakouts or breakdowns.

9. Limitations

The analysis assumes static OI levels, but intraday shifts can alter sentiment.

Global macroeconomic events (e.g., U.S. Federal Reserve actions) are not factored in but could impact FII flows.

The dataset lacks detailed strike-wise OI for precise gamma exposure analysis.

10. References

National Stock Exchange (NSE) Open Interest Data, July 21, 2025.

Historical Nifty 50 and global index closing prices (June–July 2025).

Anish Jagdish Parashar 

Indirect tax india research 

Disclaimer Content reflects personal views of the author; for trading and investment purposes consult your financial advisor.

Nifty 50: Probable Movement and Critical Levels

 Nifty 50: Probable Movement and Critical Levels

1. Market Context and Closing Price

Nifty 50 Closing Price (July 18, 2025): 24,968.4

Recent Trend (June 12 - July 18, 2025): 

The Nifty 50 has shown a marginal decline from 25,549 (June 26) to 24,968.4 (July 18), reflecting a consolidation phase after a peak. The index has been range-bound between approximately 24,700 and 25,600 over the past month, with intermittent volatility.

Global Indices:

NASDAQ Composite: Declined from 20,273.46 (June 27) to 19,662.49 (July 18), signaling global tech sector weakness.

Dow Jones: Declined from 44,094.77 (June 30) to 42,967.62 (July 18), indicating broader market caution.

S&P 500: Declined from 6,204.95 (June 30) to 6,045.26 (July 18), reinforcing a bearish global sentiment.The global indices' downward movement may exert mild pressure on the Nifty 50, particularly given its correlation with global markets.

2. Open Interest Analysis

The OI data provides insights into participant positioning, which is critical for understanding market sentiment and potential price movements.Futures OI (July 18, 2025):

DII (Domestic Institutional Investors): Net long with 35,942 contracts, indicating a bullish bias. DIIs have consistently increased their long positions from 28,909 (June 27) to 35,942 (July 18), suggesting confidence in a potential rebound or stability.

FII (Foreign Institutional Investors): Net short with -148,064 contracts, a significant increase in bearish positioning from -33,518 (June 27). This indicates FIIs are hedging or expecting a downward move.

Pro (Proprietary Traders): Net long with 18,132 contracts, a shift from a net short position of -11,740 (June 27), suggesting some speculative buying interest.Total Net Futures OI: -93,990 contracts, reflecting a bearish tilt in futures positioning, primarily driven by FII selling.

Options OI (July 18, 2025):

Total Net Options OI: -397,738 contracts, indicating heavy put writing or call unwinding, which typically suggests bearish sentiment or hedging against downside risk.

FII Options OI: Net short by -199,300 contracts, with significant short positions in both calls (355,235) and puts (260,995). This indicates FIIs are either neutral (selling both calls and puts) or preparing for a range-bound market with downside protection.

Pro Options OI: Net short by -198,438 contracts, with large short positions in calls (949,802) and puts (689,419). This suggests proprietary traders are betting on a range-bound market, writing options to collect premiums.

DII Options OI: Negligible activity (7,570 call long, 14,283 put long), indicating limited participation in options.

Key Observations from OI Data:

FIIs' Bearish Bias: The consistent increase in FII short positions in futures (-148,064) and options (-199,300) signals caution, likely driven by global market weakness and domestic uncertainties (e.g., budget announcements, macroeconomic data).

DIIs' Counter-Bullish Stance: DIIs’ net long futures position (35,942) suggests they are absorbing FII selling, acting as a stabilizing force.

Options Market Dynamics: High put OI and short call positions indicate a market expecting consolidation or a mild downward bias. The put-call ratio (PCR) can be inferred to be elevated (put OI > call OI), a bearish signal but also a potential contrarian indicator of oversold conditions.

3. Critical Levels based on the OI data and recent price action

The following are key support and resistance levels for the Nifty 50:

Support Levels:24,700 - 24,750: This zone has acted as a strong support in recent weeks (e.g., June 23: 24,971; July 14: 24,708). Significant put OI is likely concentrated at 24,700, making it a critical level where buyers may step in.24,500: A psychological and technical support level, reinforced by historical lows in June (e.g., June 4: 24,620). A breach below 24,700 could trigger selling toward this level.24,200: A deeper support level, aligning with the 200-day moving average (approximated based on trend) and significant put OI buildup.

Resistance Levels:25,100 - 25,150: This zone has acted as a resistance in recent sessions (e.g., July 10: 25,112; July 8: 25,522). High call OI is likely concentrated at 25,100 or 25,200, indicating selling pressure from option writers.25,500: A major psychological and technical resistance, aligning with the recent high (June 26: 25,549). A breakout above 25,150 could target this level.25,800: A strong resistance zone, coinciding with the all-time high in the provided data (June 26: 25,549).

Options OI-Based Levels:

Highest Put OI: Likely at 24,700 or 24,500, indicating strong support due to put writing.Highest Call OI: Likely at 25,000 or 25,200, suggesting resistance due to call writing.

Max Pain Level: Estimated around 24,900 - 25,000 (based on balanced OI and recent closing price), where the market may gravitate to minimize option losses at expiry.

4. Probable Movement

The Nifty 50 is likely to remain range-bound in the near term (next 5-7 trading sessions) with a mild bearish bias, driven by the following factors:

FII Selling Pressure: Heavy short positions in futures and options suggest FIIs are anticipating a pullback, possibly due to global market weakness (NASDAQ, Dow, S&P 500 declines) and domestic factors (e.g., budget outcomes, corporate earnings).

DII Buying Support: DIIs’ consistent long positions in futures provide a cushion, preventing a sharp decline. Their buying has historically stabilized the index during FII sell-offs.

Options Market Sentiment: High put OI and short call positions indicate a market preparing for consolidation or a minor correction. The elevated PCR suggests potential oversold conditions, which could lead to a short-term bounce if global cues improve.

Global Influence: The decline in global indices (NASDAQ: -3.02%, Dow: -2.61%, S&P 500: -2.59% over the past month)sony: -2.28%) may add downward pressure, as foreign investors often follow global trends.

Short-Term Scenarios:Bearish Case (Probability: 40%):

If global markets continue to decline or domestic triggers (e.g., disappointing earnings or policy announcements) emerge, the Nifty 50 could test 24,700 or 24,500. A break below 24,700 could accelerate selling toward 24,200.Trigger: Increased FII selling, negative global cues, or high put unwinding.Bullish Case (Probability: 30%):A reversal in FII sentiment or positive domestic catalysts (e.g., strong earnings, favorable budget) could push the index toward 25,100 - 25,200. A breakout above 25,150 could target 25,500.Trigger: DII buying momentum, short covering by FIIs, or positive global market recovery.

Range-Bound Case (Probability: 30%):

The index may consolidate between 24,700 - 25,100, with option writers dominating price action. The max pain level (24,900 - 25,000) could act as a magnet near expiry.Trigger: Lack of strong directional catalysts, balanced OI between calls and puts.

5. Technical Indicators (Assumed Based on Trend):

Moving Averages: The Nifty 50 is likely trading below its 20-day and 50-day moving averages (approximated around 25,200 - 25,300), indicating short-term bearish momentum. However, it remains above the 200-day moving average (~24,200), suggesting long-term bullishness.Relative Strength Index (RSI): Likely in the neutral zone (40-50), indicating neither overbought nor oversold conditions, supporting a range-bound outlook.

Volatility Index (India VIX): 

Likely elevated (based on global market declines), suggesting higher market uncertainty and potential for sharp moves if key levels are breached.

6. Recommendations for Traders 

Intraday/Swing Traders:

Buy Near Support: 

Enter long positions near 24,700 - 24,750 with a stop-loss below 24,500, targeting 25,000 - 25,100.

Sell Near Resistance:

 Short the index near 25,100 - 25,150 with a stop-loss above 25,200, targeting 24,800 - 24,700.

Options Strategy: Consider a neutral strategy like an Iron Condor (sell 25,200 call and 24,500 put, buy 25,400 call and 24,300 put) to capitalize on range-bound movement and collect premiums.

Positional Traders:

Wait for a breakout above 25,150 or below 24,700 to confirm directional bias. Use trailing stops to manage risk.Monitor FII/DII activity and global indices for cues on trend continuation.

7. Risks and Considerations

Global Market Influence: Further declines in NASDAQ, Dow, or S&P 500 could pressure the Nifty 50, especially given FIIs’ bearish positioning.

Domestic Catalysts: Upcoming budget announcements, Q1 FY26 earnings, or macroeconomic data (e.g., inflation, GDP) could trigger volatility.

Expiry Dynamics: As the July expiry approaches, option writers may defend key levels (24,700 put, 25,000 call), leading to choppy price action.

8. Conclusion

The Nifty 50 is likely to trade within a 24,700 - 25,100 range in the near term, with a mild bearish bias due to FII selling and global market weakness. Key support levels at 24,700 and 24,500 are critical to watch, as a breach could signal a deeper correction to 24,200. Conversely, a breakout above 25,150 could target 25,500. 

Traders should monitor FII/DII flows, global indices, and options OI for directional cues, while employing risk management strategies to navigate potential volatility.

Anish Jagdish Parashar 

Indirect tax india research 

Disclaimer: This analysis is based on the oi data and general market principles. Actual market movements may vary due to unforeseen events. Traders should conduct their own research and consult financial advisors before making trading decisions.

Data Source: National Stock Exchange (NSE)

Nifty 50 Probable Movement and Critical Levels

 

Nifty 50 Probable Movement and Critical Levels Based on Open Interest Data (July 16, 2025)

This paper analyzes the probable movement of the Nifty 50 index using open interest (OI) data, futures and options activity, and broader market indices as of July 16, 2025. By examining Foreign Institutional Investors (FII), Domestic Institutional Investors (DII), and proprietary traders' (Pro) positions, we identify critical support and resistance levels and forecast potential short-term price movements.

1. Introduction

The Nifty 50 index, a benchmark for the Indian equity market, is influenced by institutional activity in futures and options markets. Open interest data, combined with price movements and global indices, provides insights into market sentiment and potential price trajectories. This analysis leverages data from the National Stock Exchange (NSE) for July 16, 2025, to predict Nifty 50 movements and identify critical levels.

2. Data Analysis

2.1 Open Interest and Futures Data

FII Positions: FIIs hold a net short position in index futures (-125,512 contracts) and index options (-146,532 contracts), indicating bearish sentiment. Their cumulative net futures position has deteriorated from -55,545 (July 1) to -84,028 (July 16), suggesting increasing bearishness.

DII Positions: DIIs maintain a net long position in index futures (+37,984 contracts), acting as a counterbalance to FII selling. However, their position has remained relatively stable, with limited aggressive buying.

Pro Positions: Proprietary traders show a marginal net long in futures (+3,500 contracts) but a significant net short in options (-96,103 contracts), indicating mixed sentiment with a bearish tilt in options.

Daily Variations: On July 16, FIIs reduced their futures short positions slightly (-861 contracts) but maintained heavy shorting in options. DIIs reduced long positions (-13,994 contracts), suggesting caution.

2.2 Price Movement

Nifty 50 Closing: The index closed at 25,212.05 on July 16, up 16.25 points from 25,195.80 on July 15, reflecting mild bullishness.

Recent Trend: The index has shown resilience, recovering from 24,620 (June 4) to 25,637.8 (June 27) before consolidating around 25,200. However, volatility increased with a 113-point gain on July 16, signaling potential momentum.

2.3 Options Data

Option Index Net: The cumulative net option index position is -242,635 contracts, driven by FII shorting in both calls and puts. High open interest in calls (4,319,073 contracts) and puts (3,965,178 contracts) suggests significant hedging or speculative activity.

Strike Levels: High OI in at-the-money (ATM) and out-of-the-money (OTM) strikes (25,000–25,500 calls and 24,500–25,000 puts) indicates strong support around 24,800–25,000 and resistance at 25,500–25,700.

2.4 Global Indices

US Markets: The NASDAQ Composite (20,611.34, +0.46%), Dow Jones (44,458.3, +0.20%), and S&P 500 (6,263.26, +0.12%) showed modest gains on July 9, reflecting stable global sentiment. However, the Nifty 50’s correlation with US indices has weakened recently, suggesting domestic factors dominate.

2.5 FPI Investments

Equity Flows: FIIs recorded a net equity outflow of ₹173.63 crore on July 16, consistent with their bearish futures and options positions. Debt investments showed a net inflow of ₹1,432.84 crore, indicating a preference for fixed-income securities.

Derivatives Activity: FIIs sold 13,428 index futures contracts and 9,110,628 index options contracts, reinforcing their bearish outlook.

3. Critical Levels

Based on OI and price data, the following levels are critical for the Nifty 50:

Support:

24,800–25,000: High put OI and recent price consolidation suggest strong support. A break below 24,800 could trigger selling toward 24,500.

24,500: Significant put OI and historical support from early June.

Resistance:

25,500–25,700: High call OI and historical resistance from late June (25,637.8 on June 27).

26,000: Psychological and technical resistance with low OI buildup.

4. Probable Movement

Bearish Bias: FIIs’ aggressive shorting in futures and options, coupled with net equity outflows, suggests a bearish outlook. The cumulative net futures position (-84,028) and options position (-242,635) indicate sustained selling pressure.

Consolidation Likely: The Nifty 50’s recent price action (25,195.8 to 25,212.05) and DII buying provide a buffer against sharp declines. The index is likely to consolidate between 24,800 and 25,500 in the near term.

Breakout Triggers:

Bullish Case: A breakout above 25,500 with increased DII buying and FII short covering could push the index toward 25,700–26,000.

Bearish Case: A break below 24,800, driven by FII selling and global risk-off sentiment, could lead to a decline toward 24,500 or lower.

Volatility: High OI in both calls and puts suggests elevated volatility, particularly around ATM strikes. The expiry of July contracts could amplify price swings.

5. Conclusion

The Nifty 50 is poised for consolidation between 24,800 and 25,500, with a bearish bias due to FII shorting. Support at 24,800–25,000 is robust, backed by put OI and DII buying, while resistance at 25,500–25,700 remains formidable. Traders should monitor FII activity, global cues, and domestic macroeconomic data (e.g., inflation, RBI policy) for breakout signals. Risk management is crucial given the high OI and potential for volatility.

6. Recommendations

Traders: Adopt a range-bound strategy, buying near 24,800 with a stop-loss below 24,700 and selling near 25,500 with a stop-loss above 25,700.

Investors: Await a clear breakout above 25,700 or below 24,800 before taking directional positions.

Data Monitoring: Track FII/DII flows, US market trends, and upcoming economic releases for directional cues.

7. Limitations

This analysis relies on OI and price data as of July 16, 2025, and may not account for intraday shifts or external events (e.g., geopolitical risks, policy changes). Global correlations and sudden FII position unwinding could alter the outlook.

References

National Stock Exchange (NSE) Open Interest Data, July 16, 2025.

FPI Investment Trends, NSE, July 16, 2025.

Historical Nifty 50 and global index data.

Anish Jagdish Parashar 

Indirect tax india research 

Disclaimer Content reflects personal views of the author; for trading and investment purposes consult your financial advisor.

Analysis of Nifty 50 Probable Movement and Critical Levels

 

Analysis of Nifty 50 Probable Movement and Critical Levels

1. Open Interest (OI) Analysis

The OI data for futures and options provides insights into market positioning and sentiment:

Futures OI (July 15, 2025):

DIIs: Net long with 35,932 contracts.

FIIs: Net short with -121,820 contracts.

Proprietary Traders (Pro): Marginally net long with 2,721 contracts.

Cumulative Net OI: -83,167 contracts, indicating bearish positioning overall, driven by heavy FII shorting.

Daily Variation (July 15 vs. July 14): FIIs increased short positions by 3,320 contracts, while DIIs added 153 long contracts, reflecting continued bearish bias from FIIs.

Options OI (July 15, 2025):

Cumulative Net OI: -228,641 contracts, with FIIs (-143,880) and proprietary traders (-84,761) holding significant net short positions in index options.

Call vs. Put OI: Total OI for index calls (3,996,842 contracts) exceeds puts (3,525,806 contracts), suggesting higher call writing, typically a bearish signal as writers expect the market to stay below strike prices.

Key Strike Levels: High OI concentrations in calls at 25,500, 25,600, and 26,000 strikes indicate strong resistance zones, as call writers are defending these levels. High put OI at 25,000, 24,800, and 24,500 strikes suggests support zones where put writers are active.

PCR (Put-Call Ratio): Based on OI, the PCR is approximately 0.88 (3,525,806 puts / 3,996,842 calls). A PCR below 1 typically indicates bearish sentiment, as call writing dominates, aligning with the net short OI in futures and options.

2. FII and DII Activity

FIIs:

On July 14, 2025, FIIs sold ₹4,919.38 crore in equities (net) via stock exchanges, indicating profit-taking or risk-off behavior.

In derivatives, FIIs sold 31,346 index futures contracts (₹5,989.06 crore) against 12,827 contracts bought, reinforcing their bearish stance.

In index options, FIIs sold 3,907,097 contracts (₹728,039.89 crore) against 3,873,814 contracts bought, maintaining a net short bias.

DIIs:

DIIs are net long in futures (35,932 contracts), acting as a counterbalance to FII selling. This suggests DIIs are absorbing selling pressure, potentially stabilizing the market at lower levels.

3. Price Movement and Technical Levels

Nifty 50 Closing Price (July 15, 2025): 25,195.8, up 113.5 points (+0.45%) from July 14 (25,082.3).

Recent Trend: The Nifty 50 has been consolidating between 24,700 and 25,600 over the past month, with a slight upward bias in the last two sessions (+0.45% on July 15, +0.27% on July 14). However, the index remains below its recent high of 25,649 (June 26, 2025).

Key Support Levels:

24,800–24,900: High put OI at 24,800 and 24,500 strikes, combined with recent price action, suggests strong support here. A break below 24,800 could trigger selling toward 24,500.

24,500: Psychological and technical support, reinforced by significant put OI.

Key Resistance Levels:

25,500–25,600: Heavy call OI at 25,500 and 25,600 strikes indicates resistance. The index has struggled to sustain above 25,600 recently (e.g., June 26 high of 25,649).

26,000: A major psychological and OI-based resistance due to high call writing.

4. Global Market Context

US Indices (July 15, 2025):

Nasdaq Composite: 20,585.53 (July 11), showing a slight decline (-0.22% over recent sessions).

Dow Jones: 44,371.51 (July 11), marginally down.

S&P 500: 6,259.75 (July 11), also consolidating.

Implication: The US markets’ consolidation reflects cautious sentiment, potentially capping upside in global equities, including the Nifty 50, due to high valuations and macro uncertainties (e.g., interest rate expectations).

Nifty Bank Index: Closed at 57,006.65 (July 15), up 0.42% from 56,765.35 (July 14). Its movement often correlates with the Nifty 50, and its resilience suggests banking sector strength, which could support the Nifty 50 near current levels.

5. Probable Movement

Short-Term Outlook (1–2 Weeks):

Bearish Bias: The heavy FII shorting in futures (-121,820 contracts) and options (-143,880 contracts), combined with a PCR below 1, suggests bearish sentiment dominates. The Nifty 50 may face downward pressure if it fails to break above 25,500.

Consolidation Likely: The index is likely to consolidate between 24,800 (support) and 25,600 (resistance) unless a strong catalyst (e.g., global market rally or positive domestic data) emerges.

Downside Risk: A break below 24,800 could lead to a decline toward 24,500 or lower, especially if FII selling intensifies. The cumulative net short OI (-228,641 in options) supports this risk.

Upside Potential: A move above 25,600, supported by DII buying or a global risk-on sentiment, could push the index toward 26,000, though heavy call OI at this level may cap gains.

Key Catalysts to Watch:

Global Cues: US Federal Reserve policy updates or macroeconomic data (e.g., inflation, GDP) could influence FII flows.

Domestic Factors: Q1 FY26 Rosults or corporate earnings could impact sentiment.

Option Expiry: The July 31, 2025, expiry may lead to volatility as traders roll over positions or cover shorts.

6. Critical Levels and Trading Strategy

Support Zone: 24,800–24,900 (strong put OI, recent price support).

Strategy: Buy on dips near 24,800 with a stop-loss below 24,700, targeting 25,200–25,400.

Resistance Zone: 25,500–25,600 (high call OI, recent highs).

Strategy: Sell on rallies near 25,500 with a stop-loss above 25,650, targeting 25,000–24,800.

Breakout/Breakdown:

Upside Breakout: Above 25,600, target 26,000 with a stop-loss below 25,400.

Downside Breakdown: Below 24,800, target 24,500 with a stop-loss above 24,950.

7. Risk Factors

FII Selling Pressure: Continued FII shorting could exacerbate declines.

Global Volatility: US market consolidation or adverse global news could trigger risk-off moves.

Option Expiry Volatility: High OI in both calls and puts may lead to sharp moves as expiry nears.

Conclusion

The Nifty 50 is likely to consolidate between 24,800 and 25,600 in the near term, with a bearish bias due to FII shorting and a low PCR. Key support lies at 24,800–24,900, with a potential drop to 24,500 on a breakdown. Resistance at 25,500–25,600 may cap upside unless strong bullish catalysts emerge. Traders should monitor FII flows, global markets, and option expiry dynamics for directional cues.

Disclaimer: This analysis is based on the provided data and general market principles. Always conduct your own research and consult a financial advisor before making trading decisions.

Anish Jagdish Parashar 

Indirect tax india research