Nifty50 opened Wednesday’s session with a gap up, but failed to hold at higher levels and drifted towards the 11,780 level in the initial hour of trade. However, the index recovered from lower levels and formed a Hammer candle on the daily scale as buying emerged on dips.
The index managed to hold above its consolidation band and supports shifted higher gradually. The overall trend is positive and Nifty now needs to hold above 11,780 level to witness an up-move towards 11,900 and then 12,000 levels, while downside supports were seen at 11,700 and then 11,650 levels.
On the monthly options front, maximum Put open interest was at 11,800 followed by 11,700 levels, while maximum Call OI was at 12,000 followed by 11,800 levels. There was Call writing at 11,850 and 11,750 levels while meaningful Put writing was seen at 11,800 and then 11,850 levels. Options data suggested a shift in trading range between 11,750 and 11,950 levels.
India VIX moved up 1.45 per cent to 16.65.
Bank Nifty continued its positive momentum for three sessions and extended the gains towards 30,150 mark. However, it traded in a wider trading range between 29,750 and 30,150 levels for most part of the session, even as it formed a Doji candle on the daily scale. Buying emerged on dips while selling emerged at higher levels. Now, Nifty needs to hold above 29,700 level to witness an up-move towards 30,250 and then 30,500 levels, while downside supports are seen at 29,750 and then 29,500 levels.
Nifty futures closed positive at 11,853 level with a 0.50% gain. Long buildup was seen in TCS, Grasim, Bajaj Auto, Shriram Transport and Oil India while shorts were seen in Britannia, UPL and Tech Mahindra.
(Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)