By Rajesh Palviya
Nifty closed at an all-time higher of 17324 with a get of 618 points on a weekly basis. On the weekly chart the index has formed a extended bullish candle forming larger High-low compared to preceding week and has closed above preceding week’s higher indicating positive bias. The index is moving in a Higher Top and Higher Bottom formation on the weekly chart indicating positive bias. The chart pattern suggests that if Nifty crosses and sustains above 17400 level it would witness obtaining which would lead the index towards 17500-17700 levels. However, if the index breaks beneath 17200 level it would witness promoting which would take the index towards 17050-16900.
Nifty is trading above the 20 and 50 day SMA which is an essential brief-term moving typical, indicating positive bias in the brief term. Nifty continues to stay in an uptrend in the medium term, so obtaining on dips continues to be our preferred tactic. For the week, we anticipate Nifty to trade in the variety of 17700-17100 with a positive bias.
The weekly strength indicator RSI is above its respective reference lines indicating positive bias.
Nifty Derivative Outlook
Nifty futures closed at 17329.35 on a positive note with 11.02% improve in open interest and with price tag gains of 3.66% indicating Long Build-Up. The open interest position of FIIs in Index Futures is at Rs 15.764 enhanced by 1,212 crore and in Stock Futures it is at Rs 123993 enhanced by 11,171 crore. PCR OI at the moment is at 1.35 levels which is above the median line and in a comfy zone indicating positive bias in the industry. Options Built up Shows that for now Nifty has sturdy assistance at 17,200 followed by 17,000 & 16,500 and resistance at 17,500 levels followed by 17,800 & 18,000 .Nifty Option chain information recommend that 17, 000, 17,500 & 17,300 strike Contact and 17,300 strike Put followed by 17,000 & 16,500 strike has higher open interest concentration which suggests that Nifty is most likely to trade in variety of 17000-17500 level for the coming week with 17,300 acting as a pivotal level as each Call & Put have higher OI concentration at 17,300 strike price tag.
Bank Nifty Outlook
Bank Nifty began the week on a flat note and obtaining momentum for the most aspect of the week led it to close on a positive note. Bank Nifty closed at 36761 with a get of 1133 points on a weekly basis.
On the weekly chart the index has formed a sizable bullish candle forming larger High-low compared to preceding session indicating positive bias. The index is moving in a Higher Top and Higher Bottom formation on the weekly chart indicating sustained up trend on extended term charts. The chart pattern suggests that if Bank Nifty crosses and sustains above 37200 level it would witness obtaining which would lead the index towards 37500-37800 levels. However if the index breaks beneath 36400 level it would witness promoting which would take the index towards 36200-35700. Bank Nifty is trading above 20, 50, and one hundred day SMAs which are essential brief term moving averages, indicating positive bias in the brief to medium term. Bank Nifty continues to stay in an uptrend in the medium term, so obtaining on dips continues to be our preferred tactic. For the week, we anticipate Bank Nifty to trade in the variety of 37800-36200 with a positive bias.
The weekly strength indicator RSI is moving upwards and is quoting above its reference line indicating positive bias.
Bank Nifty Derivative Outlook
Bank Nifty futures closed at 36899.75 on a positive note with 27.98% improve in open interest and with price tag gains of 3.29% on weekly basis indicating Long Build Up. Bank Nifty has a sturdy assistance at 35,000 as 35,000 Put strike is getting higher OI concentration followed by 35,500 & 36,000 even though on the Call front 38,000CE strike has higher OI concentration indicating sturdy resistance level followed by 37,500 & 37,000. FII activity in Stock futures had been on Obtain side throughout the last week.
Sectors and stocks to watch in brief term
We anticipate IT, chemical, reality, FMCG, oil & gas sectors may possibly show strength even though pharma, automobile, energy sectors stay in consolidation mode. We anticipate stocks like Reliance Industries Ltd (RIL), Tata Consultancy Services (TCS), Deepak Nitrite, Havells India, Godrej Consumer Products, Brigade Enterprises, ONGC, ICICI Bank, Eicher Motors, Aurobindo Pharma can show strength in close to term.
(Rajesh Palviya is Vice President– Research (Head Technical & Derivatives) at Axis Securities Limited. The views expressed are the author’s personal. Please seek advice from your monetary advisor ahead of investing.)