US-Iran Tensions Intensify: A Pre-Opening Market Primer for March 2

Nifty 50 and Bank Nifty Update

Market Performance

On February 27, the Nifty 50 fell by 1.25% due to weak global cues and rising geopolitical risks. The index broke below its 200-day EMA and upward-sloping support trendline, indicating a strong bearish momentum.

Key Levels

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• Nifty 50: Resistance levels based on pivot points are 25,393, 25,473, and 25,601. Support levels are 25,137, 25,058, and 24,930.
• Bank Nifty: Resistance levels based on pivot points are 60,932, 61,085, and 61,332. Support levels are 60,437, 60,285, and 60,037.

Technical Analysis

The Nifty 50 formed a long red candle with above-average volumes, dipping below the 200-day EMA and SMA in a single session. The index is now trading below all key moving averages, with short-term moving averages trending downward. The RSI dipped to 40.65, and the MACD sustained below the reference line and zero line, indicating sustained bearish momentum.

The Bank Nifty decisively broke the consolidation range on the downside, falling over a percent and forming a long bearish candle. The index fell below short-term moving averages as well as the midline of the Bollinger Bands, with high volumes. Sustaining below the midline of the Bollinger Bands can intensify bearish sentiment.

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Options Data

• Nifty Call Options: The 25,500 strike holds the maximum Call open interest (with 1.47 crore contracts), which can act as a key resistance level for the Nifty in the short term.
• Nifty Put Options: The 25,000 strike holds the maximum Put open interest (with 85.11 lakh contracts), which can act as a key support level for the Nifty in the short term.
• Bank Nifty Call Options: The 61,000 strike holds the maximum Call open interest (with 16.84 lakh contracts), which can act as a key resistance level for the index in the short term.
• Bank Nifty Put Options: The 61,000 strike holds the maximum Put open interest (with 15.89 lakh contracts), which can act as a key level for the index.

Market Outlook

The psychological 25,000 mark and the long support trendline (24,850) are at risk of being breached, potentially opening the door to the Budget Day low of 24,571. However, resistance is placed in the 25,250-25,350 zone.