Nifty Outlook: Volatility Expected Ahead of Monthly Expiry (Apr 24, 2025)

FIIs Maintain Bullish Stance in Nifty Index Futures – April 23, 2024

Foreign Institutional Investors (FIIs) continued their bullish bias in the Nifty Index Futures market, with notable short covering alongside selective long additions. This reflects growing optimism while still maintaining a cautious posture.

Key Data Overview:

Contracts Bought: 5963
Notional Value: ₹1071 crore
Net Open Interest Change: Decreased by 2715 contracts

Breaking Down FII Activity:

✔ Added Longs: 1,636 contracts
✔ Covered Shorts: 5,928 contracts

Long-to-Short Ratio: 0.49
Positioning: 33% Long : 67% Short

✅ Interpretation:
FIIs are covering shorts aggressively and gradually adding longs, indicating reduced bearish conviction and early signs of a potential sentiment shift. The decrease in open interest supports the view of unwinding bearish bets rather than fresh aggressive buying.

Client Activity Snapshot:

✔ Covered Longs: 464 contracts
✔ Added Shorts: 230 contracts

Long-to-Short Ratio: 1.02
Positioning: 51% Long : 49% Short

✅ Interpretation:
Clients are relatively neutral, showing light adjustments on both sides. This suggests a wait-and-watch approach, possibly ahead of key data or resistance tests.

Market Outlook:

FIIs are slowly shifting toward neutral-to-bullish positioning, especially if the trend of short covering continues.
If long additions pick up momentum and breach the 35–40% threshold, it could trigger fresh buying and short squeezes.
Traders should continue to monitor support at 24,051 and resistance at 24,389 for breakout confirmation.

April 24, 2025 Expiry: Predicting Range for Nifty, Bank Nifty, Fin Nifty, Midcap Nifty

As Discussed in Last Analysis

Nifty has now completed a 9-session winning streak, with today marking the 10th day. If we see another gap-up open, it would be the 5th in a row, raising the likelihood of an exhaustion gap, particularly in the context of macroeconomic uncertainty and technical overextension.

Key Risk Factors to Monitor

Exhaustion Gap:
Repeated gap-ups without meaningful consolidation can often precede sharp intraday reversals or profit-booking phases.
US–China Trade Dynamics:
Reports of a potential deal could boost the Dollar Index (DXY). A rising dollar often leads to capital outflows from emerging markets, including India.
Earnings Season:
Corporate results so far have been mixed to disappointing. Once the momentum trade fades, lackluster earnings could drag sentiment lower.

Key Technical Levels to Watch

Resistance: 24,389
→ Failure to break and hold above this level after a gap-up could trigger profit-booking and short-term weakness.
Support: 24,051
→ A breakdown here could push the index lower toward the 23,800 – 23,666 zone.

Trading Strategy

✅ Use tight stop-losses to protect profits, especially after extended rallies.
❌ Avoid chasing gap-ups blindly — wait for price confirmation and intraday structure.
Partial profit-booking is advisable if holding long positions.
Be prepared for short setups if a reversal pattern emerges, especially below key support levels.

Nifty has shown signs of indecision and exhaustion, forming a Doji on Tuesday followed by a Hammer today, both classic candlestick signals hinting at potential reversal or pause in trend. With monthly expiry set for tomorrow, traders should prepare for heightened volatility.

Expiry Context & Price Action

Previous Expiry (March): Closed at 23,591
Current Position: Up 737 points from the last expiry — strong momentum in favor of the bulls
March and April: Both monthly expiries have favored bulls, squeezing short positions

However, with a 9-day winning streak and astro-sensitive date (April 25) coinciding with expiry, the market is ripe for profit booking or a short-term pullback.

Nifty Trade Plan for Positional Trade ,Bulls will get active above 24167 for a move towards 24478/24792 Bears will get active below 23857 for a move towards 23549/23243

Traders may watch out for potential intraday reversals at 09:27,10:55,12:11,01:20,02:41 How to Find and Trade Intraday Reversal Times

Nifty April Futures Open Interest Volume stood at 0.55 lakh cr , witnessing liquidation of 32 Lakh contracts. Additionally, the decrease in Cost of Carry implies that there was closure of LONG positions today.

Nifty Advance Decline Ratio at 39:11 and Nifty Rollover Cost is @22900 closed below it.

Nifty Gann Monthly Trade level :23521 closed above it

Nifty has closed Above its 200 SMA @ 24051 Trend is Buy on Dips till above 24000

Nifty options chain shows that the maximum pain point is at 24000 and the put-call ratio (PCR) is at 1.01 .Typically, when the PCR open interest ranges between 0.90 and 1.05, the market tends to remain range-bound.

Nifty 50 Options Chain Analysis

The Nifty 50 options chain indicates that the highest open interest (OI) on the call side is at the 24400 strike, followed by 24500 strikes. On the put side, the highest OI is at the 24200 strike, followed by 24100 strikes. This suggests that the market participants are expecting Nifty 50 to remain range between 24000-24300 levels.

Options Market Activity – April 24, 2024

‍♂️ Retail Investor Activity

Call Options:

Added: 330K contracts
Shorted: 315K contracts

Put Options:

Added: 218K contracts
Shorted: 191K contracts

✅ Interpretation:
Retail participants are showing a balanced approach, with nearly equal activity on both the buying and selling side. This suggests a neutral-to-cautious sentiment, possibly preparing for range-bound trade or mild volatility ahead.

‍ FII Options Activity

Call Options:

Added: 140K contracts
Shorted: 152K contracts

Put Options:

Added: 123K contracts
Shorted: 185 contracts

✅ Interpretation:
FIIs are continuing with a premium selling strategy, particularly in calls, indicating they expect the market to consolidate or face resistance near current levels. The near-equal addition on both sides points to hedged or neutral positioning, aligning with the broader trend of caution despite recent bullish moves in futures.

In the cash segment, Foreign Institutional Investors (FII) bought 3332 Cr , while Domestic Institutional Investors (DII) sold 1234 cr.

Traders who follow the musical octave trading path may find valuable insights in predicting Nifty’s movements. According to this path, Nifty may follow a path of 23037-23722-24408-25134 This means that traders can take a position and potentially ride the move as Nifty moves through these levels.Of course, it’s important to keep in mind that trading is inherently risky and market movements can be unpredictable.

It is very difficult for the mind to just watch the market unfold. Our minds, egos, left hemispheres, must get into the act no matter now many times they have been proven to be painfully incapable of doing the job consistently.

For Positional Traders, The Nifty Futures’ Trend Change Level is At 24171 . Going Long Or Short Above Or Below This Level Can Help Them Stay On The Same Side As Institutions, With A Higher Risk-reward Ratio. Intraday Traders Can Keep An Eye On 24262 , Which Acts As An Intraday Trend Change Level.

Nifty Expiry Range

Upper End of Expiry : 24515

Lower End of Expiry : 24108

Nifty Intraday Trading Levels

Buy Above 24300 Tgt 24343, 24385 and 24424 ( Nifty Spot Levels)

Sell Below 24265 Tgt 24239, 24200 and 24166 (Nifty Spot Levels)

Wishing you good health and trading success as always.As always, prioritize your health and trade with caution.

As always, it’s essential to closely monitor market movements and make informed decisions based on a well-thought-out trading plan and risk management strategy. Market conditions can change rapidly, and it’s crucial to be adaptable and cautious in your approach.

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