By Shivangi Sarda
Nifty index opened positive and headed towards 17950 zones on Wednesday. It continued its winning streak of the last fourth straight sessions led by buying interest at every key level. It gave the highest daily close of the last 35 sessions and ended with gains of around 120 points, forming a Bullish candle on the daily scale and has been forming higher highs – higher lows from the last four sessions.
India VIX rose by 6.87% from 16.12 to 17.22 levels. Volatility has been on the rise even after the market surged as Call writers were under unwinding pressure. On the Options front, in the Monthly series Maximum Call OI is at 18000 strike while Maximum Put OI is at 17000 followed by 17500 strike. Put writing is seen at 17500 and 17700 while minor Call writing at 18200 and 17800. Options data suggests a wider trading range between 17500 to 18200 zones while an immediate trading range in between 17700 to 18100 zones.
Bank Nifty outlook
Bank Nifty opened positive and skyrocketed above 37850 zones. Breakout along with short covering move drove the Banking index and it closed with massive gins of around 850 points. It formed a healthy Bullish candle on daily scale and is making higher highs – higher lows from the last four sessions.
For weekly Bank Nifty, Maximum Put OI is at 37000 then 36000 strike and maximum Call OI is placed at 38000 then 39000 strike. We have seen Call writing in 38000 and 39000 while Put writing is witnessed at 37000 and 36000 strike. Now it has to hold above 37500 zones for an up move towards 38000 and 38250 zones whereas support can be seen at 37250 and 37000 zones.
Stocks to watch out for
On the sectoral front, all the sectors barring IT, Media and Pharma stocks traded in the positive territory out of which banking and Financial Services sector outperformed the broader market and witnessed the most buying interest. We have positive bias in both the indices and stock-specific positive move could be seen in Bajaj Finance, ICICI Bank, Tata Steel, Eicher Motor, Axis Bank, DLF, Oberoi Realty etc.
(Shivangi Sarda is a Quantitative Analyst, Derivatives and Technical Research at Motilal Oswal Financial Services Ltd.)