Indices lost all gain today and broke firm support of 18500. Unless it croses above this level, nifty may touch to 18400-300 & if recoveres, 18700-800 can be seen again.. History shows bullish trend in past December months. But this month's performance is still not up to the mark.
Today nifty formed a bearish engulfing candle on daily chart indicating further fall in coming days. Traders also seem to be cautious ahead of the next big event - the FOMC interest rate decision due next week. Today's low should not be broken I. e. 18400. Weekley bearish candle also indicates weakness. Yesterday market has given good recovery, but today it ruined.
The Option data indicated that the expected near-term trading range for Nifty would be 18,300-18,650 levels. Maximum put open interest was seen at 18,000 strike, followed by 18,500 strike, while maximum call writing seen at 19000-500-20000. Option chain indicates wide range but market is volatile with lower vix. As India vix is at lower rate, one should not worry about correction / consolidation. Also, there is a breach of rising channel on the daily chart. Thus the Nifty looks poised for a short term consolidation. 18,300-18,650 is expected to be the short term consolidation range.
The banking index lost all its gains in the afternoon, but recouped all those losses in late trade and closed with 37 points gains at 43,633, forming a bearish candle on the daily charts. Bnf us still trading in broader range of 43000-44000.
Looking forward to global cues and economical environment, market may consolidate for few day. Profit booking by investors is fully expected.
Signing off for the day and week. 💐