The domestic markets are expected to open weak on the special day of trading, with the Gift Nifty indicating a gap-down opening of about 100 points for Nifty.
The market is anticipated to remain volatile as expectations surrounding the Budget have been increasing from all sectors of the economy.
Osho Krishnan, Senior Analyst of Technical & Derivatives at Angel One, stated, “As we approach the upcoming Budget session and consider the anticipated trade tariffs from the US government, it’s important to acknowledge the current market uncertainty. We expect to gain clearer insights once these events unfold, likely by next week. In the meantime, it’s beneficial to adopt a flexible approach and focus on strategic opportunities rather than making aggressive bets during the special trading session of the Union Budget.”
However, F&O data continues to give a cautious outlook.
Derivative data reflects a mildly bearish undertone, with call writers maintaining a slight upper hand over put writers, hinting at cautious sentiment near higher levels. The 24,000-call strike has seen open interest surge to 77.38 lakh contracts, establishing it as a key resistance zone. On the other hand, substantial put writing at the 23,000 strike, with 60.63 lakh contracts, confirms it as a strong support area, as analyzed by Dhupesh Dhameja, Derivatives Analyst at SAMCO Securities.
Moreover, increasing put additions between 23,000 to 23,500 further solidify the base, while call unwinding at higher strikes suggests a shift in bullish positioning. The Put-Call Ratio (PCR) climbing to 1.01 from 0.88 indicates improving bullish sentiment. The “max pain” level at 23,500 suggests limited downside potential, although volatility remains a factor to watch.
India VIX, the market’s fear gauge, declined by 6.57% to 16.24, reflecting easing volatility. However, as VIX remains above 15, market uncertainty persists, urging traders to remain cautious despite the positive trend.
Meanwhile, cues from the US market are negative as all the major indices ended in the red.
