The options data indicates that the Nifty can trade in the 9,000-9,700 range in the coming days.
The Nifty50 opened higher and remained strong throughout the session on April 23, driven by banking & financial and IT stocks. Hope of a stimulus package continued to support the market, though the rise in new infections remained a worry.
The index gained for the second consecutive session to close above 9,300 for the first time since March 13 and formed a small bodied bullish candle on daily charts as the closing was higher than the opening.
Overall, the index has been in a consolidation zone for a couple of weeks. It is unlikely to see a major upmove till it closes decisively above the 9,400-mark, say experts.
Traders are advised to remain neutral on long side, whereas intraday traders can consider shorting below 9,170 and look for an initial target between 9,090 and 9,050 with a stop above the intraday high.
The Nifty opened higher at 9,232.35 and briefly dipped to hit an intraday low of 9,170.15, but immediately bounced back to trade higher for the rest of the session.
The index touched an intraday high of 9,343.60 in late trade and closed 126.60 points, or 1.38 percent, higher at 9,313.90.
"Albeit Nifty50 bridged the bearish gap present in the zone of 9,044 – 9,230 registered on April 21, it witnessed a small bullish candle after moving in a narrow range of 173 points before signing off the session. Hence, for the time, the index can be expected to consolidate with a 500 point range inside a trading band of 9,400 – 8,900 unless a decisive close is witnessed above 9,400 levels," Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.
A strong close above 9,400 shall open up bigger targets, placed around 9,950, he said.
If the index slips below 9,170 in the next session, then it may come under selling pressure on intraday basis with targets placed around 9,050 levels, he said.
A strength beyond 9,343 may extend the upswing to 9,390, where ideally some selling pressure can be expected, he said.
The options data indicated that the Nifty could trade in the 9,000- 9,700 range in the coming days.
On monthly options front, maximum Call open interest was at 10,000 then 9,500 strike while maximum Put open interest was at 9,000 then 8,000 strike. Meaningful Put writing was seen at 9,000 then 9,300 strike while Call writing was seen at 9,300 then 9,500 strike.
India VIX fell by 8.38 percent to 39.23 levels.
The Nifty Bank also showed a trend similar to the Nifty50 and closed at 20,268, up 566.15 points, or 2.87 percent, to form a small bodied bullish candle on daily charts.
The index concluded the day near its 20-DEMA for the third consecutive session.
"RSI oscillator is placed positively on daily scale and thus we may see some positive bias in the banking counters. Currently, the Bank Nifty is moving in sideways direction between broader range of 18,700 to 21,100 levels from last nine trading sessions and it may move in the same for coming days too," Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services said.
Going forward, support is placed at 19,500 then 19,100 levels while resistance is placed at 21,300-21,500 levels, he said.Time to show-off your poker skills and win Rs.25 lakhs with no investment. Register Now!
