4 Nifty Weekly News Letter

Nifty exactly took resistance at 5735 (refer last week charts click here) and trading below that. 

The week started immediately with breakout above 5700. For the initial four sessions, it consolidated and remained below 5700 and fell till 5640 to absorb the selling pressure seen in the global markets. Finally, when global indices closed in the green, it bounced back and closed above 5700. Markets finally ended in green and managed to close convincingly above 5629 levels. A ‘doji star’ like formation on the weekly charts at higher levels explains indecisiveness and move beyond 5735-5750 should be determining the directional move for markets. The market sentiments in past few days has turned extremely bullish with significant appreciation in rupee and from trading perspective the positive bias is likely to remain upbeat as long it sustains above 5629 levels.

• Rollover in Nifty future stood at 64% which was in line with previous month rollover, while Bank Nifty rollover stood at 55% which was way beyond its previous expiry rollover. 
• Nifty October Call options started with the highest open interest at 5700/5800 and the Nifty closed above the first hurdle of 5700. This led to short covering in 5700 Call options. Sustainability above 5700 may lead further upsides towards 5940-5950.
• India VIX had shot up from 15 to 19 in the previous week within a few sessions due to short covering seen in Call strikes. However, last week it slipped again to 16 points suggesting the higher risk premium in Call options was eroded by 5700/5800 Call writing
• Noticeable Put base in the October series is placed at the 5500/5600 Put strike

Nifty: Nifty unless crosses 5735 is going to be taking resistance and We expect the midcap space to witness momentum in the coming sessions

Bank Nifty: The major support for the index is placed at 11000 where highest Put base is placed. The noticeable Call base is placed at 11500, which would be the immediate hurdle above which one can expect short covering to pan out again towards 11900.

Key Nifty (Spot) Levels

Buy Nifty(Spot) above 5780 T1: 5811 T2: 5849 T3: 5888 T4: 5926 T5: 5965 T6: 6003 SL: 5639

Sell Nifty(Spot) below 5629 T1: 5601 T2: 5564 T3: 5527 T4: 5489 T5: 5452 T6: 5416 SL: 5773

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