By Sameet Chavan
Our domestic market started the day on an optimistic note with a gap up, taking cues from the positive Asian peers. However, the market refrained at higher levels as bears reciprocated instantly, and gradually it started correcting as the day progressed. The benchmark index concluded the day in red by shedding 0.65 percent to settle a tad below the 16500 mark.
The benchmark index seems tentative amid the ongoing whipsaw movements from the past couple of trading sessions. The soared volatility is the primary concern for the participants that could be sensed through the pattern movement. The undertone remains on the bearish side, and any aberration on the global front could aggravate the bears. In our sense, the more it consolidates around 16400-16500 and fails to sustain at higher levels, it increases the probability of triggering one more round of sell off to test 16200 or may even slide below that as well. On the contrary, the immediate resistance is placed near the 16700 – 16800 odd zone which coincides with the 200 DEMA, followed by a cluster of supply zones towards the 17000 mark.
Going forward, the market is expected to remain uncertain with its wild moves until the geopolitical concerns fade away. Hence, it is advisable to stay light and avoid aggressive bets in these market conditions.
As far as F&O activity is concerned, we saw addition of fresh shorts in Nifty as well as BankNifty. Stronger hands continued their relentless selling in equities; they also added bearish bets in index and stock futures. In options segment, build-up was scattered in the range 16500-17500 call options. Meanwhile, on the put side ATM strike 16500 added fresh positions.
(Sameet Chavan is a Chief Analyst-Technical and Derivatives at Angel One. Views expressed are the author’s own. Please consult your financial advisor before investing.)