By Rajesh Palviya
On the day-to-day chart, the index has formed a bullish candle and has closed above its previous six session’s consolidation variety(17450-17250) representing positive bias ahead. The index is moving in a Higher Top and Higher Bottom formation on the day-to-day chart indicating a sustained uptrend. Nifty has witnessed a Long Build Up in the existing week with an enhance in the price tag of 5.33% and an enhance in OI by 22.49% as of Wednesday wherein there was an addition of 27.88 lakh shares in OI, escalating from 123.97 lakh to 151.85 lakh shares.
Nifty September rollover stands at 8.32%, when the sentiment indicator, Nifty Put Call Ratio, employed by traders to gauge the industry sentiment and mood, is at present at 1.47 compared to 1.45 of last week, indicating positive bias.
India VIX, a industry volatility indicator normally known as the worry gauge, is at present trading 13.73% compared to 13.94% last week. Implied Volatility of Nifty ATM alternatives for the existing series is at 12.61% in contrast to 12.56% of last week, indicating marginal volatile movement on either side in the coming session.
Nifty Put alternatives OI distribution shows that 17,400 has highest OI concentration followed by 17,500 & 17,300 which could act as help for existing expiry and on the Call front 17,500 followed by 17,600 witnessed substantial OI concentration and could act as resistance for the existing expiry.
In weekly alternatives, there was Call writing seen at 17,500 strike followed by 17,600 & 17,700 when on the Put side noticeable activity of writing was witnessed in 17,500 & 17,400 strike costs. Options information recommend an instant trading variety involving 17,400 and 17,600 levels.
Nifty Open Interest Concentration
Nifty Open Interest Change
Bank Nifty Outlook
On the day-to-day chart, the index has formed a bullish candle and has closed above its earlier session’s higher representing positive bias ahead. The index is moving in a Higher Top and Higher Bottom formation on the day-to-day chart indicating a sustained uptrend. The chart pattern suggests that if Bank Nifty crosses and sustains above 36950 levels it would witness getting which would lead the index towards 37100-37300 levels.
In the existing series there has been a Long Build Up witnessed in Bank Nifty Futures with an enhance in the price tag of 3.44% and an enhance in OI by 20.90% as of Wednesday wherein there was the addition of 3.06 lakh shares in OI, escalating from 14.63 lakh to 17.69 lakh shares. Bank Nifty September rollover stands at 7.70%, when Bank Nifty Put Call Ratio, a sentiment indicator employed by traders to gauge the industry sentiment and mood, is at present at .93 compared to .93 of last week indicating positive bias.
Bank Nifty Put alternatives OI distribution shows that 36,500 has highest OI concentration followed by 36,000 & 36,700 which could act as help for existing expiry and on the Call front 37,000 followed by 37,500 & 38,000 witnessed substantial OI concentration and could act as resistance.
In weekly alternatives, Call writing was seen at 36,800,37,000 & 37,200 strike when on the place side it was seen at 36,500 & 36,600.Options information indicated an instant trading variety involving 36,000 and 37,200 levels.
Bank Nifty Open Interest Concentration
Bank Nifty Open Interest Change
Nifty 50 method for weekly expiry
Traders can initiate a Moderately Bullish method with decreased premium outflow & reduced breakeven point known as BULL Contact SPREAD of 16th September Expiry wherein trader will get one lot of 17,500 contact strike @ 55 and simultaneously sell one lot of 17,600 contact strike @ 11, so that net outflow or maximum loss will be restricted to up to Rs 2, 2 00 (44 points). If Nifty on expiry closes above 17,544, the method will get started producing profit, on the other hand as the threat is restricted so is the profit. The maximum gains will be restricted up to Rs 2,800 (56 POINTS) only, mainly because the gains of extended 17,500 strike contact will be offset by the sold 17,600 strike contact if Nifty closes above 17,600 on expiry.
(Rajesh Palviya, VP– Research (Head Technical & Derivatives), Axis Securities. Views expressed are the author’s personal.)