Market Outlook for May 8: Key Developments to Watch Before the Opening Bell

Nifty 50 Consolidates Amid Choppy Movement

The Nifty 50 index failed to show follow-through buying and closed flat on May 7, following a sharp rally in the previous session. Despite choppy movement near the crucial hurdle of 24,400–24,500, experts believe the underlying trend remains positive, supported by improving momentum indicators and the index holding above short- and medium-term moving averages.

A decisive and sustained move above the 24,350–24,400 zone could open the door for further upside toward 24,600 and then 24,800 in the coming sessions. On the downside, immediate support is placed at 24,200, followed by the crucial support level of 24,000.

Key Levels for Nifty 50 and Bank Nifty

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The Nifty 50 formed a bearish candle with a minor upper shadow on the daily charts, indicating mild profit booking at higher levels amid choppy movement. The index remained above its short- and medium-term moving averages, with the short-term moving averages also trending upward. Additionally, it held above the 50 percent Fibonacci retracement level of the correction from the February high to the April low.

Options Data

• Nifty Call Options Data
  • Maximum Call open interest: 25,000 strike (83.61 lakh contracts)
  • Maximum Call writing: 24,400 strike (24.79 lakh contracts)
  • Maximum Call unwinding: 24,200 strike (-8.65 lakh contracts)
• Nifty Put Options Data
  • Maximum Put open interest: 24,000 strike (73.04 lakh contracts)
  • Maximum Put writing: 23,800 strike (17.2 lakh contracts)
  • Maximum Put unwinding: 24,500 strike (-1.59 lakh contracts)
• Bank Nifty Call Options Data
  • Maximum Call open interest: 56,000 strike (8.71 lakh contracts)
  • Maximum Call writing: 57,000 strike (95,160 contracts)
  • Maximum Call unwinding: 55,000 strike (-1.27 lakh contracts)
• Bank Nifty Put Options Data
  • Maximum Put open interest: 56,000 strike (8.94 lakh contracts)
  • Maximum Put writing: 56,000 strike (34,620 contracts)
  • Maximum Put unwinding: 55,000 strike (-1.34 lakh contracts)

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Funds Flow and Put-Call Ratio

• Funds Flow (Rs crore): Not available
• Put-Call Ratio (PCR): 1.08 on May 7, compared to 1.19 in the previous session

The increasing PCR indicates a firming up of a bullish sentiment in the market. If the ratio falls below 0.7 or moves towards 0.5, it indicates selling in Calls is higher than selling in Puts, reflecting a bearish mood in the market.

India VIX and Market Sentiment

• India VIX: Extended its downtrend for the fourth straight session, declining 0.34 percent to 16.62
• Long Build-up (65 Stocks): An increase in open interest (OI) and price indicates a build-up of long positions
• Long Unwinding (25 Stocks): A decline in open interest (OI) along with a fall in price, indicating long unwinding
• Short Build-up (73 Stocks): An increase in OI along with a fall in price, indicating a build-up of short positions
• Short-Covering (51 Stocks): A decrease in OI, along with a price increase, indicating short-covering
• High Delivery Trades: A high share of delivery reflects investing (as opposed to trading) interest in a stock

F&O Ban

• Stocks added to F&O ban: Nil
• Stocks retained in F&O ban: Nil
• Stocks removed from F&O ban: Nil