Nifty 50 Expiry Scenarios Explained: A Binary Decision Tree for Traders

 

1️⃣ Global cues – supportive but selective risk-on

US markets:

Dow flat → money rotating, not exiting

NASDAQ +0.9%, SOX +1.5% → tech leadership intact

Nvidia +3.4% → AI sentiment still strong

Macro overhang:

NFP + CPI this week → volatility pockets possible, but rate-cut expectations (June) remain supportive

📌 Inference: Global risk sentiment = positive bias, not euphoric. This supports dip-buying, not blind chasing.

2️⃣ What multi-day participant data screaming

🔹 Futures positioning (trend context)

FIIs:

Consistently net short index futures

BUT → cumulative futures shorts peaked earlier and are now reducing

DIIs:

Steadily net long → acting as downside absorber

Pro traders:

Light net shorts → tactical, not aggressive

📌 Big shift:

This is NOT fresh short build-up anymore.

It’s short covering + base building after a prolonged bearish stretch.

3️⃣ Options data (post-market, 10 Feb expiry)

Key takeaways from your strike-wise OI:

Max Pain: 25,800

Heavy Put OI concentration:

25,600 / 25,700 / 25,800

Call OI resistance:

26,000 → psychological + writers active

PCR ≈ 1.06 → neutral-to-bullish, not stretched

ATM IV ~12.6, IV percentile high → premiums rich, market expects movement

📌 Inference:

Option writers are defending 25,700–25,800 aggressively, not positioning for breakdown.

4️⃣ Daily chart structure (very important)

What the chart tells me:

Price reclaimed short-term EMAs

RSI ~56 → bullish zone, not overbought

MACD histogram turning positive → momentum shift confirmed

Long lower wicks near 25,450–25,500 → strong demand absorption

Cloud resistance cleared intraday, now acting as support

📌 Technical bias:

This looks like a post-correction base, not a distribution top.

5️⃣ Putting it all together – Market Sentiment

🟢 Primary sentiment: Cautiously bullish / pullback-buy

FIIs reducing shorts

DIIs providing structural support

Options defending downside

Global tech tailwind intact

This is not a runaway rally, but odds favour higher highs after dips.

6️⃣ Probable Nifty 50 movement (10 Feb – expiry day)

🎯 Base case (Highest probability ~60%)

Opening: mild gap-up or flat

Intraday dip: towards 25,750–25,800

Bounce zone: VWAP + Put wall

Close range: 25,900 – 26,000

👉 Classic VWAP test → bounce day.

🟡 Alternate case (~25%)

Early strength → test 26,000–26,050

Call writers defend → consolidation between 25,900–26,000

🔴 Low-probability risk case (~15%)

Global shock / data leak

Breakdown below 25,650 (hourly close)

Then fast move to 25,450, where DIIs likely step in again

7️⃣ Key levels you should respect

Level

Role

26,050–26,100

Supply / call writers

26,000

Psychological ceiling

25,850–25,800

Pivot + max pain

25,650

Line in the sand

25,450

Strong demand base

Bottom line 

This is not a bearish market anymore.

It’s a short-covering + accumulation phase where downside is being bought, not sold.

Thus while facing expiry day blues traders must be highly cautious.Perfect — let’s lock this into a clean, executable binary decision tree for 10 Feb expiry, built exactly on your OI structure + futures behaviour + daily chart.

This is decision-first, not opinion-first.

🧠 ROOT NODE (Pre-open / First 15 mins)

Is Nifty holding ABOVE 25,750 after first 15 minutes?

✅ YES → Go to NODE A (Bullish Control)

NODE A1: Price ABOVE VWAP + 25,750

Market read

Put writers in control

Short covering continues

DIIs absorbing dips

🔹 Next check (30–45 mins):

Does Nifty reclaim / hold 25,850?

✅ YES → SCENARIO A1 (Trending Up Day) 🔥

Probability: ~40%

Path

25,750 → 25,850 → 25,950 → 26,000

Behaviour

CE writers at 26,000 bleed

Pullbacks are shallow

Time decay hurts sellers

Expiry stance

Directional bullish or limited risk bullish

❌ NO → SCENARIO A2 (Range + VWAP Magnet)

Probability: ~20%

Path

25,750 – 25,900 range

Behaviour

Market respects Put wall

Call writers defend 26,000

Chop + theta decay

Expiry stance

Non-directional / range strategies benefit

❌ NO → Go to NODE B (Sell Pressure Test)

NODE B1: Price BELOW 25,750

Critical question 👉 Is 25,650 holding on a 15-min close?

❌ NO (Break & Hold below 25,650) → SCENARIO B1 🚨

Probability: ~15%

Path

25,650 → 25,500 → 25,450

Behaviour

Put writers unwind

Fast move (gamma risk)

DIIs expected near 25,450

Expiry stance

Momentum downside trades only

No blind selling of puts

✅ YES (Reclaim 25,750 quickly) → SCENARIO B2 (Bear Trap) 🪤

Probability: ~25%

Path

25,650 → 25,750 → 25,900

Behaviour

Failed breakdown

Aggressive short covering

Best risk-reward move of the day

Expiry stance

Quick bullish scalps / spreads

🌳 COMPLETE BINARY TREE (Visual)

Copy code

OPEN

                  |

          Is 25,750 holding?

             /           \

           YES             NO

           |               |

     Reclaim 25,850?    Hold 25,650?

        /     \           /        \

      YES     NO        YES        NO

      |        |         |          |

   A1 Trend  A2 Range  B2 Trap   B1 Breakdown

📌 STRATEGIC SUMMARY (Expiry Mindset)

Condition

Bias

Above 25,750

Buy dips

Above 25,850

Ride trend

25,750–25,900

Theta zone

Below 25,650

Respect downside

Fast reclaim

Aggressive long

🎯 My high-conviction call (based on  data)

Highest probability path:

Dip → VWAP / 25,750 → Bounce → 25,900–26,000

Line in the sand: 25,650

Expiry magnet: 25,800–25,900

Good luck.

Anish Jagdish Parashar 

Indirect tax india online research 

Disclaimer: Content reflects author's views; for investment decisions and trading proposes consult your financial advisor.