As expected Nifty supported the 15670-15700 level with buying pressure on daily closing basis at the primary trend’s Support zone in confluence. IT stocks underperformed with banks adding more character to the indecisiveness. Low VIX (12) indicates the stability in market with buying pressure. 15900 will be the trigger for the continuation. 15670 will be the crucial Support.
Daily Time frame Analysis
- On Friday Nifty 50 the benchmark Index closed at 17585.15 (-44.35) (-0.25%).
- After a minor gap up in the daily time frame, Nifty failed to protect its gains and closed in negative territory after marking an all-time high, indicating volatility to continue ahead in the next week.
- Going ahead from here, there are higher chances market may continue to be volatile with positive bias until the hourly trend shows any kind of weakening in momentum.
- Understanding ICHIMOKU CLOUD FORMATION a strong bearish candle was formed in daily chart far from the levels of the cloud below the current level, suggesting that a mean reversion could be the likely scenario in the coming week around the Leading Span A&B levels – 17250-16700.
- Friday’s action in NIFTY has created a wide trading range for the INDEX, 17400-17790- These levels will also crucial ahead.
- There are higher chances that the market may stay in the broad consolidation range for some time with profit booking intent.
- The weekly RSI stood at 79.20, which is a bullish indication for the current trend indicating momentum to continue. The RSI is mildly overbought and seems that a slight selling pressure will force RSI to take support at 50-60 levels if the minor trend is likely to continue further.
- The market is near the crucial territory. It would be prudent to continue following every rise with strict trailing stop losses in place to protect profits at higher levels.
- FIIs have net bought Rs 6476 crore and DIIs sold Rs 2896 crore worth of equity shares last week in the cash market.
- On the option data, maximum Put open interest was seen at 17500 followed by 17600 strikes while maximum Call open interest was seen at 17600 &17700.
Hourly Time frame Analysis
- The Nifty Futures in the hourly took support near (17560-17600) after breaking the range in the last half of the week and marking a fresh high.
- A strong Bearish candle formed in daily charts with volume participation in Nifty futures after a mild gap up and closing near day’s low.
- Analyzing the Nifty future Open Interest Data from the past week to the current day, a decrease of 7% OI indicates LONG UNWINDING. If further short buildup is seen in the first half of the week, the short term reversal will be confirmed.
- Understanding ICHIMOKU CLOUD the current trend’s crucial support stands near LEADING SPAN A&B which are around 17535-17640. If the daily closing tends to come below these levels, further weakness is evident.
- On a contrary, if the trend may show strength to continue further after taking support near these levels there are higher chances we may find resistance around 17920-18070.
- High selling volume was observed in the last session after NIFTY topped in the morning session.
- Hourly RSI is at 56.76, which is at a neutral level. If the RSI takes support at 40-30 levels and again breaks the 60 level- this will be the consolidation indicating for the week.
- Avoid making fresh LONG POSITION as markets are highly overbought.
- Any DIPS towards 16800-17050 would be an opportunity to buy for short term trading.
- Any closing below 17050 will be a trend reversal for positional & swing traders.
IMPORTANT LEVELS TO WATCH FOR INTRADAY AND SWING TRADING
16860 -17050 -17240 – 17420 -17530 -17660 -17800
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What is weekly expiry of Nifty options?
Each week’s Thursday sees the expiry of Nifty weekly contracts. If Thursday is a trading holiday, the previous day will be the expiration or last trading day. On the day of expiry, all contracts expire at the time of the regular market close or at such other time as the exchange may specify. Since they are monthly contracts, the final week’s contract in the watchlist will simply carry the name of the month and the strike price. The date of expiry will not be included.
How is Nifty closing decided?
The weighted average closing prices of the index’s components during the last half-hour are used for calculating the NIFTY closing prices.
What happens if a share hits the upper circuit?
A stock will only have buyers and no sellers if the upper circuit price is reached. Therefore, you won’t be able to purchase the stock you sold for intraday back. Therefore, this intraday trade will ultimately become a delivery trade.
What happens if shares hit a lower circuit?
A stock will have no buyers and only sellers if it reaches the lower circuit. As a result, you won’t be able to sell the shares you purchased for intraday trading. This will also be changed to a delivery trade.
What happens when weekly options expire?
The spot price is trading higher than the strike price when the call option expires in the money (ITM). Due to the lower strike price than the market price, the option holder must decide whether to execute the call option and purchase the underlying securities.