Stock Market

F O: Options data suggests shift in Nifty range to 12,000-12,300 zone

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By Chandan TapariaNifty50 had a gap up opening for the sixth consecutive session on Wednesday and registered a new all-time high at 12,237.

The index corrected in the initial hour of trades, but took support at its Horizontal Trendline and rebounded piercingly. It continued to make higher highs and lows for the fifth session and formed a positive candle on the daily scale.

Till the time Nifty sustains above the 12,150 mark, it may continue the up-move towards the 12,300 – 12,350 zone, while major supports are now shifting higher towards the 12,050 – 12,100 zone. In monthly options, maximum Put open interest was at 12,000 followed by 11,500 levels, while maximum Call OI was at 12,000 followed by 12,200 levels.

There was meaningful Put writing at 12,200 and 12,100 levels, while Call writing was seen at 12,400 followed by 12,300 level.

Options data suggested a shift in trading range between 12,000 and 12,300 levels in the next few sessions. India VIX fell 2.06 per cent to 12.33 level.

Lower volatility could continue to support the index and attract fresh buying interest. In line with the benchmark indices, Bank Nifty opened on a positive note and corrected in first hour of the trade.

However, the banking index managed to hold its support at the 32,000 mark and rebounded piercingly in the later half.

As a result, it concluded the session around the highest point and formed a Dragonfly Doji candle on the daily chart.

It made higher highs and lows for the fifth consecutive session, sustaining well above its consolidation breakout level.

Looking at the overall chart structure, we reiterate our positive view for an up-move towards the 32,500 – 32,750 zone.

Major support for the index remains intact in the 32,000 – 31,750 zone. Nifty futures closed positive at 12,247 with 0.49 per cent gains.

Long buildup was seen in MFSL, NMDC, Shriram Transport Finance, Sun Pharma and Motherson Sumi while shorts were seen in Tata Global, Bank of Baroda, Sun TV, Tata Motors and Voltas. (Chandan Taparia is Technical - Derivative Analyst at MOFSL.

Investors are advised to consult financial advisers before taking an investment calls based on these observations)




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Category: Stock Market


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