By Sameet Chavan
The August month began with a bang last week as we not only managed to attain the a great deal-awaited milestone of 16000 but also moved beyond it convincingly. This was followed by a quiet begin this week. In reality, for the duration of the 1st 3 trading sessions, our markets consolidated with some hint of profit booking at reduce levels. Fortunately, the mighty bears offered cushion at the reduce variety of 16200 – 16170 for the Nifty.
On the weekly expiry day, we kick-began marginally greater and soon after a modest hiccup in the 1st half the marketplace had a gradual up move to register a new all-time higher at 16375.
Undoubtedly, the trend remains bullish and more importantly, the broader marketplace got its mojo back soon after taking some beating in the last 3 – 4 trading sessions. It would be complicated for the benchmark index to retain up the similar pace now. Hence, regardless of a sturdy uptrend, one need to prevent aggressive bets in the index at this juncture. We would see a gradual move to test new millstones of 16500 and beyond but meanwhile, anticipate person stock to carry out nicely. Traders are advised to focus more on person stocks and continue with one step at a time strategy.
Since we are at such elevated levels, one need to prevent complacency since any aberration on the worldwide front could outcome in a surpassing decline in our marketplace. One desires to retain this in the back of the thoughts and need to retain booking timely income on momentum trades. The sacrosanct help is now clearly visible at 16200 – 16170 in the close to term.
As far as Bank Nifty is concerned, it abruptly wakes up some day and exhibits indicators of a breakout move. But once again the momentum fades all of a sudden in this space, resulting in a consolidation phase. Similarly, given that the last couple of days the Bank Nifty has been creating valiant attempts to go previous the sturdy wall of 36200 – 36300 but unable to do so. Only a sustainable breakout outdoors this variety upwards would outcome in a more rapidly move in banking space. Till then contemplate 36300 – 35500 as an quick variety.
As far as possibilities activity is concerned, we saw tremendous conviction from the place writers on Wednesday at the strike of 16200. On Thursday, the base got shifted greater to 16300. Throughout the day, this level was defended convincingly and as we step into the next weekly expiry, the highest OI nonetheless stands at 16300 Puts, suggesting quick help for Nifty. On the flipside, there is not a great deal activity seen from get in touch with writers in the coming weekly expiry. It would be intriguing to see how factors pan out on Friday.
(Sameet Chavan is Chief Analyst – Technical and Derivatives, Angel Broking. Views expressed are the author’s personal.)