Indian stocks ended near 52-week highs with 2% weekly up move on Friday. Indian stock indices were among the best-performing ones globally. Nifty remained volatile in a shortened week due to domestic political flip flops. However it closed at a new 52-week high level of 5692. Momentum was primarily seen in PSU banking stocks, which saw short covering along with metals and financial stocks. However, stocks from the technology and pharma space observed continuation of profit booking trend of last week.
Nifty rallied almost 7-9% in September contract. The weighted average price for Nifty is at 5360 and Bank Nifty at 10400. Huge index options of around 100 bn in September by FII followed by spike in VIX to 19 implies VIX can rally up to 23 in the short term. Huge put buying of around 2mn was seen in Nifty sep 5700. OI activity turned significantly bullish wherein near the money Put strikes of 5500 and 5600 saw aggressive additions. On the Call side, closure was visible in 5500 and 5600 strikes and positions were rolled to the deep OTM 5800 Call strike. We expect Nifty to trade in 5800-5500 in the short term.
Nifty: We expect the Nifty to remain positive during the settlement week and the index may settle the September series near highs. However, 5800 levels may prove crucial for the Nifty and it may consolidate around these levels for some time. In the meanwhile, midcap stocks may continue their upward momentum
Bank Nifty: The Bank Nifty witnessed a significant recovery due to significant covering in private sector heavyweights. Fresh long addition was observed among PSU midcap stocks. We expect the Bank Nifty to trade with a positive bias while major support can be seen around 11000 levels.
TG1 achieved and We are carrying forward our last week Nifty longs with stop loss 5628.
Buy Nifty(Spot) above 5650 T1: 5690 T2: 5728 T3: 5765 T4: 5803 T5: 5842 T6: 5880 SL: 5551
Sell Nifty(Spot) below 5550 T1: 5514 T2: 5477 T3: 5440 T4: 5403 T5: 5366 T6: 5330 SL: 5652
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Nifty made high 5728 and i have closed all my positions trades in nifty now.
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