Chandan Taparia

Nifty index had a volatile Budget day but overall witnessed strong recovery of 400 points from recent swing low of 10,583 to 10,983 zones in last four sessions.

It corrected from higher zones in the last week but again managed to attempt the same key hurdle area.

It formed a Bullish candle on weekly while a High Wave candle on daily scale as it has been trying hard to surpass 10,985 zones since last 10 weeks.

It has seen been making higher highs – higher lows from last three trading sessions and needs to hold above 10,820 zones to extend its move towards 10,985 then a fresh leg of rally towards 11,080 and 11,176 zones.

While on the downside, support exists at 10,777 then 10,700-10,650 zones. Index has got stuck in a broader trading range and requires a decisive range breakout for the next leg of rally.

Nifty has got stuck in the grip of the Option writers for most part of the January series and has been settling near to 10,800 zones from last three consecutive series.

India VIX fell down by 11.14 percent at 15.72 levels in this week which is giving some comfort to bulls but needs to hold below 16 zones to get a decisive range breakout above 10,985 zones.

On the option front, maximum Put OI is at 10,700 while maximum Call OI is at 11,000 followed by 11,200 strike.

Call writing is seen at 11,200 and 11,100 strikes while Put writing is seen at 10,800 and 10,900 strike.

Option band signifies an immediate trading range in between 10,700 to 11,000-11,200 zones. Nifty future has seen Rollover of 61.84 percent which is lowest in last 17 series since August 2018, lower Rolls suggests that participants are waiting to build fresh position on a decisive range breakout.

Bank Nifty remained under pressure as it failed to hold above 27,500 zones and drifted towards 27,000 zones.

It formed a Bearish candle on daily while a Long Legged Doji on weekly scale which indicates an absence of follow up buying interest at higher zones.

It has to cross and hold above 27,150 zones to witness an up move towards 27,350 then 27,500-27,750 zones while on the downside support exists at 26,850 then 26,666 zones.

Sector wise positive view on IT, FMCG and Pharma stocks while a negative setup in PSU Banks and Media stocks.

Stock specific positive view on Reliance Industries, Infosys, Tech Mahindra, Hexaware, Dr Reddy, Divis Lab, Havells, Voltas, HUL, Dabur and Britannia.


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