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Nifty50 failed to surpass Monday’s high and drifted towards the 11,860 mark in Tuesday’s trade. However, it recovered some intraday losses and managed to close above the 11,900 mark. It formed a Hanging Man kind of candle on the daily scale, as the market lost momentum at higher levels.
Nifty has been respecting the rising support trend line, but the psychologically important 12,000 mark is acting as an immediate hurdle to commence the next leg of rally. Now, it has to continue to hold above 11,850 level to witness an up-move towards 12,000 and then 12,103 levels, while on the downside major support is seen at 11,780 level.
On monthly options front, maximum Put open interest was at 11,600 level followed by 11,300, while maximum Call OI was at 12,000 followed by 11,800 levels. There was Put writing at 11,300 and 11,200 levels while marginal Call writing was seen at 12,200 level. Options data suggested a broader trading range between 11,600 and 12,100 levels.
India VIX closed flat at 15.91 level, which hinted at rangebound trade with limited downside and upside for next few sessions.
Bank Nifty negated the formation of higher lows of last four sessions and closed negative after gaining for seven sessions. It formed a bearish candle on the daily scale, as it failed to surpass the crucial hurdle at 30,800 level on the last session. Now, it has to continue to hold above 30,000 level to witness an up-move towards 30,600 and then 30,800 levels, while on the downside, supports are seen at 30,000 and then 29750 levels.
Nifty futures closed negative at 11,958 with a loss of 0.18 per cent. Long buildup was seen Bharat Forge, IndiGo, SBI, Bajaj Finance and Dabur while shorts were seen in BEL, PNB, CESC and IGL.
(Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)
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