By Chandan Taparia
Nifty50 opened on a flat note and hit a new all-time high at 12,389 on Thursday. However, the index remained volatile throughout the session and eventually ended around its opening price. In the process, it formed a Doji candle on the daily chart, indicating indecisiveness among market participants.
Nifty is hovering around its strong hurdle of Rising Trendline on the weekly chart, which also coincides with the 100 per cent extension of the previous up-move on the daily chart. Though the index is trading near its resistance level, we are not seeing any noticeable weakness in prices. Thus, traders are advised to refrain from taking pre-emptive shorts as long as Nifty sustains above its immediate support of 11,280 – 12,293 zone.
Nifty’s major support exists at 12,150 levels. On the flipside, resistance is placed in the 12,450 – 12,500 zone.
On the options front, maximum Put open interest was at 12,000 level followed by 12,200, while maximum Call OI was at 12,500 followed by 12,400 level. There was marginal Call writing at 12,500 and 12,400 levels, while some Put writing was seen at 12,300 and 12,350. Options data indicated a trading range between 12,000 and 12,500 levels.
India VIX moved up marginally by 0.44 per cent to 14.18 level. There was some rangebound move in VIX, which suggested that the bulls are holding a grip while we expect volatility to spike ahead of the Union Budget 2020.
Bank Nifty moved within the trading range of the previous session and, thus, formed an Inside Bar on the daily chart. The banking index is making lower highs for last four sessions and is facing a hurdle around the 32,000 mark. At the same time, it is respecting its bullish gap area between 31,451 and 31,667 levels. Now, the index has to hold above 31,750 level to witness an up-move towards 32,350 and then 32,500-32,600 zone, while on the downside support is placed at 31,500 level.
Nifty futures closed flat at 12,371 level. There was long buildup in Apollo Hospital, MFSL, Muthoot Finance, Manappuram and MGL while shorts were seen in GAIL, Infratel, NTPC, Hindalco and HPCL.
(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