By Shivangi Sarda
The Nifty 50 index had opened gap up on Wednesday and escalated all through the day to touch but an additional lifetime higher mark of 18197 levels. The index gave a consolidation breakout on every day and weekly time frame and decisively holding nicely above 18000 zones. Bulls cheered the marketplace at larger zones and purchasing interest swept across the street. It formed a Bullish candle on the every day frame and closed with gains of about 170 points.
India VIX was up by 1.58% from 15.84 to 16.10 levels. A modest rise in volatility indicates a volatile swing in the marketplace at larger zones but general comparative reduced VIX suggests that any modest decline could be purchased and bulls are holding the tight grip in the marketplace. Now VIX demands to cool down under 15-14 zones to continue the smooth ride. On the Option front, Maximum Put OI is at 17500 followed by 17000 strike when maximum Call OI is at 18000 followed by 18500 strike. Minor contact writing is seen 18200 then 18100 strike when Put writing is seen at 18000 strike. Option information suggests a broader trading variety in involving 17700 to 18500 zones when an instant trading variety in involving 17850 to 18300 zones.
Nifty and Bank Nifty are trading at life time higher zones and purchasing interest must sustain the marketplace ahead of the festive season.
Bank Nifty assistance at 38350-38100
Bank Nifty opened gap up yesterday and moved towards its all-time higher of 38779 levels in the initial tick. The day proceeded with some consolidation and it closed with gains of about 110 points. It formed a modest Bearish candle on every day scale with lengthy reduced shadow indicating purchasing was visible but only at declines. It has been forming larger lows from the last eight sessions in a row.
For weekly Bank Nifty, Maximum Put OI is at 38000 strike and maximum Call OI is placed at 40000 strike. We have seen Call writing in 38700 and 38800 when Put writing is witnessed at 38600 and unwinding in 36500 strike. Now it has to hold above 38500 zones to witness an up move towards 38800 and 39000 levels when on the downside significant assistance is seen at 38350 and 38100 levels.
On the sectoral front, barring Realty space, all other sectors traded in the positive territory out of which Auto and Metal outperformed the broader marketplace.
We have a positive stance in Auto (Mahindra & Mahindra, Ashok Leyland), Open up Theme Related stocks (Jubilant Foodworkd, Indian Hotels), Consumption (ITC, Tata Consumer, Marico), PSU Units (State Bank of India, BEL, ONGC, NTPC). A hold above 18050 zones is essential to extend its move towards 18250 and 18500 levels whereas on the downside assistance is seen at 17947 and 17850 zones.
(Shivangi Sarda is a Quantitative Analyst, Derivatives and Technical Research at Motilal Oswal Financial Services. Views expressed are the author’s personal. Please seek advice from your economic advisor just before investing.)