Nifty opened positive on Friday and continued its positive to rangebound move as it headed towards the 11,940 level. The index managed to hold the 11,800 level and closed the last day of the week with net gains of around 80 points.
The index continued to form higher lows for the 10th session and entire base of the market shifted higher and looked set to hit the psychologically important 12,000 level and then knock the lifetime high territory.
The index formed a bullish candle on the daily and weekly charts and saw the highest weekly close in 31 weeks since February 20, 2020. The index continued its winning streak for the seventh consecutive session and has rallied more than 1,100 points in last 11 sessions. Now, it has to hold above 11,800 level to witness a further rise towards 12,000 and then 12,200 levels, while on the downside, major support exists at 11,750 level.
India VIX remained flat at 20.38 level. It needs to cool down for the bull’s grip to tighten on the market.
On the options front, maximum Put open interest stood at 11,500 followed by 11,000 levels, while maximum Call OI was at 12,500 followed by 12,000. Marginal Call writing was seen at strike prices 12,400 and 12,200 while there was Put writing at 11,500 and 11,800 levels. Options data suggested a wider trading range between 11,500 and 12,200 levels, while the immediate trading range is seen between 11,700 and 12,100 levels.
Bank Nifty opened positive and favourable cues from the RBI money policy boosted the index to head towards 23,900 level. It formed a strong bullish candle on the daily and weekly scales and formed higher highs in the last six sessions. The index closed the day with around 650 points gain and registered a weekly gain of around 1,600 points. Now, it has to hold above 23,500 level to witness a bounce towards 24,200 and then 24,500 levels, while on the downside key support exists at 23,200 and then 23,000 levels.
Nifty futures closed positive at 11,947 level with 0.98 per cent gains. The trade setup looked positive in LIC Housing Finance, ICICI Bank, Wipro, Axis Bank, HDFC Bank, MindTree, SBI, M&M Finance, IndiGo, Havells, Infosys and Hero MotoCorp but weak in ZEEL, Cummins India, Tata Consumer, UPL and IGL.
(Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)