Hormuz Tensions Fuel Oil Price Surge: Key Market Indicators for April 24
Nifty 50 Extends Downtrend, Falls 0.8 Percent Amid Ongoing Tensions
The Nifty 50 continued its downtrend, correcting 0.8 percent for the second consecutive session on April 23, amidst the ongoing standoff at the Strait of Hormuz and US-Iran negotiations that kept oil prices above $100 a barrel. This decline has led to a cautious mood among investors, with momentum indicators signaling a potential short-term reversal pattern.
Key Levels and Trends
| Index | Resistance Levels | Support Levels |
|---|---|---|
| Nifty 50 | 24,273, 24,314, 24,381 | 24,139, 24,098, 24,031 |
| Bank Nifty | 56,713, 56,866, 57,115 | 56,215, 56,061, 55,812 |
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The Nifty 50 formed a bearish candle with a long upper shadow on the daily charts after a gap-down opening, while the Bank Nifty dropped 1.4 percent after a gap-down opening. The RSI is on the verge of a bearish crossover, while the MACD held above the signal and zero lines, but the histogram's green bars continued to fade, indicating weakening momentum and a cautious near-term outlook.
Options Data and Fund Flow
| Nifty Options Data | Bank Nifty Options Data |
|---|---|
| Maximum Call open interest at 24,500 strike (1.06 crore contracts) | Maximum Call open interest at 57,000 strike (8.19 lakh contracts) |
| Maximum Put open interest at 24,000 strike (69.73 lakh contracts) | Maximum Put open interest at 55,000 strike (7.09 lakh contracts) |
The Nifty Put-Call ratio (PCR) declined to 0.92 on April 23, compared to a 1.02 previous session, indicating a cautious mood in the market. The India VIX, a fear index, extended its uptrend for the second consecutive session, rising 1.58 percent to close at 18.59, signaling some discomfort for bulls.
Read also: Stocks Decline on Fading Optimism for Iran Nuclear Accord and Disappointing Quarterly Earnings
Funds Flow and Short Positions
A long build-up was seen in 28 stocks, while 75 stocks saw a decline in open interest (OI) along with a fall in price, indicating long unwinding. On the other hand, 77 stocks saw an increase in OI along with a fall in price, indicating a build-up of short positions. Additionally, 37 stocks saw short-covering, meaning a decrease in OI, along with a price increase.
Stocks Under F&O Ban
Securities banned under the F&O segment include companies where derivative contracts cross 95 percent of the market-wide position limit. As of now, SAIL is the only stock retained in the F&O ban list.
Investor Takeaway
Investors should be cautious of the ongoing standoff at the Strait of Hormuz and its impact on oil prices.
More in Market
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