Nifty opened positive on Tuesday but breached previous day’s low in the initial half of the session. However, it recovered well by more than 250 points from its intraday low in the latter half and closed the day near its high levels. Buying was visible on declines and the index regained strength after a halt of last two sessions. It formed a Bullish Hammer kind of candle on the daily scale and closed with a gain of around 165 points. Now, it has to continue to hold above the 17,500 level, for a rise towards 17, 650 and 17,777 levels, whereas support is placed at 17,350 and 17,272 levels.
India VIX fell 5.55 per cent from 17.49 to 16.52 level. A spurt in India VIX in the last few sessions has caused a volatile swing and now it has to cool down below the 14 mark to continue the bullish stance in the market.
On the options front, maximum Put Open Interest stood at the 17,000 level followed by 17,500, while maximum Call OI was at 17,500 followed by 18,000 levels. Marginal Call unwinding was seen at 17,900 and then 17,800, while there was minor Put writing at 17,400 and then 17,500 levels. Options data suggested a broader trading range between 17,000 and 17,800 levrls while the immediate trading range stands between 17, 300 and 17,700 levels.
Bank Nifty opened positive and fell towards 36,500 level. However, it saw a recovery in the second half of the session and managed to close near the 37,250 mark with a gain of 90 points. It formed a small-bodied bullish candle on the daily scale with a long lower shadow indicating that the bulls were quite active on declines. Now it has to continue to hold above the 37,250 level to witness a bounce towards 37,800 and 38,000 levels while on the downside support was seen at 36,850 and 36,500 levels.
Nifty futures closed positive with a gain of 1.01 per cent at 17,562 level. Among specific stocks, the trade setup looked bullish in Mindtree, PVR, Godrej Properties, ONGC, Bajaj Finance, IndusInd Bank, PEL, Coforge, Indigo, LTI, Bajaj Finserv, ITC, Pidilite Inds, M&M Fin, MCX, Balkrishna Inds, LTTS, TechM, Indian Hotels Company and Jubilant FoodWorks but weak in Indiabulls Housing Finance, Maruti, SunTV, BPCL, Hero Motocorp, Bajaj Auto and MRF.
(Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)