Investors' Guide: Key Market Developments to Watch at the Opening Bell on May 13

Market Bears Tighten Grip on Nifty 50

On May 12, the Nifty 50 plummeted by nearly 2 percent, decisively breaking below the tight range of 23,800-24,500 that had held for the last several weeks. The decline followed the rupee weakening to a fresh low, elevated oil prices, and persistent FII outflows. Additionally, the index also broke the 23,400 support level (the 50 percent Fibonacci retracement of the April rally) and entered the bullish gap zone formed on April 8.

As long as the index trades below 23,400, a fall toward 23,200-23,000 is possible in the upcoming sessions. However, reclaiming and sustaining above this level can drive the index upward toward 23,500-23,600, according to experts.

Key Levels for Nifty 50 and Bank Nifty

Read also: SpaceX Seeks Record $75 Billion IPO, Potentially Positioning Elon Musk as the World's First Trillionaire

Nifty 50 Options Data

• The 24,000 strike holds the maximum Call open interest (54.31 lakh contracts), which can act as a key resistance level for the Nifty in the short term.
• Maximum Call writing was observed at the 23,500 strike (33.26 lakh contracts), followed by the 24,000 and 23,800 strikes.
• The 23,000 strike holds the maximum Put open interest (43.91 lakh contracts), which can act as a key support level for the Nifty in the short term.
• Maximum Put writing was placed at the 23,000 strike (23.14 lakh contracts), followed by the 22,800 and 23,500 strikes.

Bank Nifty Options Data

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

• The 55,000 strike holds the maximum Call open interest (6.88 lakh contracts), which can act as a key resistance level for the index in the short term.
• Maximum Call writing was observed at the 54,000 strike (2.38 lakh contracts), followed by the 54,500 strike and 53,500 strike.
• The 54,000 strike holds the maximum Put open interest (5.54 lakh contracts), which can act as a key level for the index in the short term.
• Maximum Put writing was placed at the 53,500 strike (78,390 contracts), followed by the 53,600 strike and 53,000 strike.

Funds Flow and Put-Call Ratio

• The Nifty Put-Call ratio (PCR) rose to 0.93 on May 12, compared to a 0.76 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.

India VIX and Market Sentiment

• The fear gauge, India VIX, jumped 3.92 percent to 19.28 and extended its northward journey for the third consecutive session while rising above all key moving averages, favouring bears.
• It is necessary for the VIX to reverse its trend toward the 17-15 levels to bring bulls back into a comfort zone.

F&O Segment

• Securities banned under the F&O segment include companies where derivative contracts cross 95 percent of the market-wide position limit.
• Stocks added to F&O ban: Nil
• Stocks retained in F&O ban: SAIL
• Stocks removed from F&O ban: Nil