By Chandan Taparia
Nifty50 opened positive and extended its gains towards the 11,360 level on Friday, but remained highly volatile throughout the session as it traded in a broader trading range of 180 points.
The index formed a bullish candle on the daily as well as weekly charts forming long upper and lower shadows which implied that every dip got bought into. At the same time, supplies remined intact at higher levels.
Now, it needs to hold above 11,250 level to witness a bounce towards 11,400 and then 11,500 level, while on the downside major support is seen at 11,100 level.
On the options front, maximum Put open interest was at 11,000 followed by 11,200 levels, while maximum Call OI was at 11,500 followed by 12,000 levels. Marginal Put writing was seen at 11,000 and then 11,300 while there was Call unwinding at all immediate strike prices. The options data suggested a wider trading range between 11,000 and 11,600 levels.
India VIX fell 0.52 per cent to 17.14.
Bank Nifty remained highly volatile and continued to trade in a wider range between 27,500 and 28,600 levels. It formed a bearish candle on the daily scale and a small-bodied candle on the weekly scale with a long upper shadow which suggested selling pressure at higher levels. The index has been stuck in a broader trading range between 27,600 and 28,800 levels from last six sessions. Volatile swings are likely to continue in this wide range.
Now, the index needs to hold and sustain above 28,250 level to witness a bounce towards the 28,550-28,800 zone while on the downside major support is seen at 27,500 level.
Nifty futures closed positive at 11,318 level with a gain of 0.57 per cent. There was long buildup in Biocon, Indiabulls Housing, Tata Global, PVR and Cipla while shorts were seen in RBL Bank, GAIL, TCS and IndiGo.
(Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)
Source: Economic Times