Nifty index opened negative but managed to hold above 8,100 zones and witnessed sustained buying interest till the end of session. It has made a strong bullish candle or a Bullish engulfing pattern on daily chart as it fell below previous day’s low but managed to recover and closed above high of the last session. It has rallied by around 135 points from day’s low levels and closed strongly with the gain of around 70 points even after Brexit referendum concern .
It has again hit its crucial 8,242 mark which is 61.80 pe cent retracement of entire down leg from 9,119 to 6,825 levels. Now it has to decisively hold above 8,242 mark to witness an up move towards 8,330 then 8,400 zones whereas on the downside multiple supports are seen at 8150 then 8100 and 8065 levels.
India VIX was up by around 1 per cent at 17.50 but it fell down from its high of 18.45 levels. Volatility has seen a spike in last couple of sessions and near to three months high levels which indicates that volatile swing may continue in the market for next coming sessions.
Looking at the option data, maximum Put Open Interest (OI) is at 8,000 followed by 8,100 strike while maximum Call OI is at 8,300 followed by 8,400 strikes. We have seen huge Put writing at 8,100, 8,200 and 8,300 strikes which indicates that supports are firm at lower zones but no major unwinding was seen in 8,300 strike which may continue to keep hurdle near to 8,330 zones on higher side.
Bank Nifty underperformed the Nifty index as heavyweight private banks were dull but it managed to close above 17,700 levels. It has major support at 17,500 while hurdle at 18,000 zones.
The author is Derivatives & Technical Analyst at Anand Rathi