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F&O: If Nifty stays above 12,100, it may head towards 12,200-12,300

A bullish momentum after a ‘Hammer’ candle on Tuesday is a positive sign for the market.

Last Updated: Feb 19, 2020, 06.50 PM IST
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F&O: Bears keep a tight grip on market; Vix keeps falling
Going forward, if Nifty holds above the 12,100, then we may see a bounce towards 12,200 and then 12,300.
By Chandan Taparia

NSE Nifty snapped its losing streak of the last four sessions on Wednesday on across-the-board buying. The market breadth also turned strongly in favour of the bulls. Due to decent buying interest from lower levels, the index formed a bullish candle on the daily chart.

A bullish momentum after a ‘Hammer’ candle on Tuesday is a positive sign. We also observed the formation of a Bullish Island Reversal pattern on the daily scale, which bodes well for the bulls.

If Nifty holds above 12,100, then we may see a bounce towards 12,200 and then 12,300. On the flipside, major support is now shifting higher to 12,030.

On the options front, maximum Put open interest was at 12,000 followed by 11,800 strike while maximum Call OI stood at 12,300 followed by 12,500 strike. We have seen meaningful Put Writing at 12,100 followed by 12,000 strike while Call Unwinding was seen at all the immediate strikes. Option data indicates the trading range between 11,900 and 12,250 levels.

India VIX fell down by 3.36 per cent to the 14.02 level.

Bank Nifty opened with a decent upside gap on back of gapup opening in Kotak Mahindra Bank. But, it failed to sustain at higher levels and corrected in the initial hour. The index took support around 30,600 mark and rebounded piercingly in the later half of the session. Eventually, it formed a small bodied candle with long lower shadow, which indicates that dips got bought into. Now, if Bank Nifty manages to hold 30,600, then we may see an upmove towards 31,100 and then 31,350. Strong support shifted to 30,600 and then 30,250.

Nifty futures gained 1.18 per cent to the 12,148 level. Long builtup was seen in Aurobindo Pharma, Bharti Infratel, Torrent Pharma, Equitas and Voltas, while shorts were seen in Tata Motors, Motherson Sumi, Sun Pharma and SAIL.

(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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