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Nifty kickstarted the week on a positive note, as it witnessed a sharp rally of more than 150 points in Monday’s trade. The bulls were aggressive from early trade and continued to pull the benchmark indices higher as the day progressed. It witnessed sustained buying interest till the end of session and formed a Bullish Marubozu candle on the daily scale.
Nifty witnessed a breakout after the consolidation of last 16 trading sessions from Bullish Pennant pattern on the daily chart, indicating resumption in bullish momentum in the coming days. After the consolidation phase of last three weeks, the index managed to close above its immediate hurdle at 12,035 level, and was on the verge of making new all-time high.
It has to continue to hold above psychologically important 12,000 mark to be able to extend its move towards 12,103 level and then see a fresh rally towards 12,250 while on the downside support exists at 11,920 and then 11,850 levels.
On the monthly options front, maximum Put open interest was at 12,000 followed by 11,900 level, while maximum Call OI was at 12,000 followed by 12,100 level. Meaningful Put writing was seen at 12,000 and then 11,950 levels, while Call unwinding was seen at all immediate strike prices. Options data suggested a shift in trading range between 11,900 and 12,200 levels.
India VIX moved up 0.89 per cent to 15 mark. Now, VIX needs to hold below 15 mark to surpass the recent highs and extend the fresh high territory.
Bank Nifty witnessed sustained buying interest throughout the session and headed towards the 31,600 mark. It engulfed the price movement of last three sessions and formed a big green body candle on daily chart. It has been forming higher highs and lows for last seven weeks and supports are shifting higher gradually.
Now it has to continue to hold above 31,200 level to head towards its lifetime high of 31,783 and then begin a fresh rally towards the 32,000-32,250 zone. On the downside, major support exists in the 31,000-30,800 zone.
Nifty futures closed positive at 12,102 level with a decent gain of 1.58 per cent. There was long buildup in Bharti Infratel, Indiabulls Housing Finance, L&T Finance, Jindal Steel and Hindalco while shorts were seen in Yes Bank, Zeel, BEL, Dish TV and ONGC.
(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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