Nifty 50 Option Strategy Report for July 14, 2025

Intraday Market Outlook for July 14, 2025

The Nifty 50 index, currently at 25,150, is expected to face downward pressure on July 14, 2025, based on recent market trends and technical analysis. The following probabilities are estimated for the trading day (9:30 AM to 3:00 PM IST):

Movement

Probability

Upside (>25,150)

30%

Downside (<25,150)

60%

Volatile (>1% move)

70%

Assumptions and Supporting Analysis

• Technical Analysis: According to 5paisa, on July 11, 2025, the Nifty 50 closed at 25,149.85, down 0.81%, with bearish signals as it closed below key Exponential Moving Average (EMA) trendlines and the Relative Strength Index (RSI) below 50, the lowest in three months. Support levels are at 24,992 and 24,894, with resistance at 25,308 and 25,406. The current level of 25,150 is closer to support, suggesting a higher likelihood of testing lower levels.

• Fundamental Analysis: Recent market weakness is attributed to disappointing Q1 earnings from IT giants like TCS, which triggered a sell-off in IT and auto sectors, as noted in posts on X from @Sahi_HQ and @SharedotMarket. Global trade concerns, particularly U.S. tariff announcements, have added caution, though India was not targeted, per @pankaj_2690. Defensive sectors like pharmaceuticals and FMCG have shown resilience, which may limit downside but not reverse the trend.

• Real-Time News Sentiment: Negative sentiment prevails due to weak IT earnings and global trade uncertainties. Upcoming corporate earnings on July 14, such as HCL Tech, may influence intraday movements, as per The Hindu BusinessLine.

• Forecast Data: DollarRupee predicts a Nifty close at 24,947 on July 14, reinforcing the bearish intraday outlook. The wide predicted range (22,951–26,943) indicates high volatility, supporting the 70% probability of a >1% move.

Option Strategy Recommendation

For trading on July 14, 2025, with a high-risk approach and holding until the July 31, 2025, expiry, the recommended strategy is to buy ATM call options with a strike price of 25,150. This recommendation is based on forecasts from LongForecast and DollarRupee, both predicting a Nifty close at 25,329 by July 31, above the current level, suggesting profitability for call options.

Expected Returns and Risks

• Call Options (Strike 25,150):

  • Premium: Approximately ₹150 (assumed based on typical Nifty option pricing for 17 days to expiry).

  • Expected Return: Approximately 19.33%, calculated as [(25,329 - 25,150) - 150] / 150 * 100%, assuming the Nifty closes at 25,329 at expiry.

  • Probability of Profit: High, as the predicted expiry price exceeds the strike price.

  • Major Risks: If the Nifty closes below 25,150 at expiry, the call options will expire worthless, resulting in a 100% loss of the premium. Sudden volatility spikes or negative news, such as unexpected corporate earnings or geopolitical developments, could drive the index lower.

• Put Options (Strike 25,150):

  • Premium: Approximately ₹150 (assumed).

  • Expected Return: -100%, as the predicted expiry price of 25,329 is above the strike, rendering puts worthless.

  • Probability of Profit: Low, given the bullish expiry forecast.

  • Major Risks: The high likelihood of the Nifty closing above 25,150 at expiry makes this strategy unprofitable. Even a temporary intraday drop may not offset the loss if the index recovers by expiry.

Supporting Data

The following table summarizes key technical levels for July 14, 2025, from 5paisa:

Level

Value

Support 1

24,992

Support 2

24,894

Resistance 1

25,308

Resistance 2

25,406

The bearish technical indicators (RSI < 50, below EMA) and recent market declines (0.81% on July 11, 0.47% on July 10) support the intraday downside probability. However, the longer-term forecast of 25,329 by July 31 suggests a recovery, favoring call options for the expiry period.

Additional Considerations

• Implied Volatility: High volatility (70% probability of a >1% move) may increase option premiums, impacting returns. Without real-time option chain data, the assumed premium of ₹150 is an estimate.

• Option Greeks: The delta of ATM options is approximately 0.5, meaning a moderate sensitivity to price changes. High volatility could increase vega, making options more expensive but potentially profitable if the predicted upward move occurs.

• Macro Factors: The Reserve Bank of India’s neutral stance on rates and uneven domestic demand, as noted in Bigul, may limit significant upside in the short term but not derail the longer-term recovery.

Actionable Summary

• Strategy: Buy call options near ATM.

• Strike: 25,150.

• Premium: Approximately ₹150 (assumed; actual may vary).

• Probability of Profit: High, based on the predicted Nifty level of 25,329 at expiry.

• Expected Return: Approximately 19.33%.

• Major Risks: Nifty closing below 25,150 at expiry due to unexpected market events or volatility.

Intraday Probabilities for July 14, 2025:

• Upside: 30%

• Downside: 60%

• Volatile: 70%