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    F&O: Nifty50 negates higher top and bottom; VIX too sees a spike

    Synopsis

    Nifty has to respect the immediate support at 11,450 level to witness a bounce towards the 11,600-11,650 zone, while on the downside next major support exists in the 11,350-11,333 zone.

    Nifty50Getty Images
    India VIX moved up 2.24 per cent from 19.66 to 20.10 level. VIX needs to cool down below 20-18 zone to let the bulls have a grip for the next leg of rally.
    By Chandan Taparia

    Nifty on Thursday opened negative in line with weak cues from global markets and remained under pressure as there was absence of buying interest at higher levels. The index negated the formation of higher top and bottom on the lower time frame chart and got stuck in a trading range. It formed a bearish candle on the daily scale and wiped out entire gains of last session to close with the loss of around 90 points.

    The RSI indicator is turning lower on the daily scale, which suggests testing of lower support with a consolidative move but the upside remains capped. Now it has to respect the immediate support at 11,450 level to witness a bounce towards the 11,600-11,650 zone, while on the downside next major support exists in the 11,350-11,333 zone.

    India VIX moved up 2.24 per cent from 19.66 to 20.10 level. VIX needs to cool down below 20-18 zone to let the bulls have a grip for the next leg of rally.

    On the options front, maximum Put open interest stood at 11,500 followed by strike price 11,000, while maximum Call OI was at 12,000 followed by 11,600 levels. There was Call writing at 11,500 and then 11,600 levels, while Put writing was seen at 10,800 and then 11,000 levels. Options data suggested a higher trading range between 11,400 and 11,800 levels.

    Bank Nifty failed to surpass the immediate hurdle at 22,500 level and remained under pressure to fall towards the 22,250 level. It formed an Inside Bar on the daily scale, as the index traded between the trading range of last session. It has been stuck between 22,000 and 22,750 levels since last seven sessions and requires a decisive range breakout for the next leg of rally. Now it needs to hold above 22,500 level to witness some stability and move towards the 22,750 level and then 23,200. However a hold below 22,000 level may drag the rate-sensitive index towards 21,750 and 21,500 levels.

    Nifty futures closed negative at 11,527 level with a loss of 0.76 per cent. The trade setup looked positive in Dr Reddy’s, HCL Tech, LIC Housing Finance, Cadila Healthcare, IGL, SRF, Lupin, Jubilant Foodworks, Biocon, Mindtree, Maruti, Infosys and Havells but negative in NMDC, Indiabulls Housing Finance, Bajaj Finserv, Petronet and PowerGrid.

    (Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)



    (Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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