Nifty needs to hold above 17200 to touch 17350-17500, Bank Nifty may reach 37000 if it holds 36500

India VIX fell down by 8.14% from 21.16 to 19.44 levels. Volatility has spiked to multi-month high levels signalling wild swings in the market.

For weekly Bank Nifty, Maximum Put OI is at 36000 strike and maximum Call OI is placed at 37000 strike. (Image: REUTERS)

By Shivangi Sarda

Nifty 50 index opened positive on Wednesday and gained strength as recovery was seen despite hurdles at key levels. It remained within the range of yesterday’s candle and closed with gains of around 180 points. It comparatively remained less volatile and formed a small-bodied Bullish candle on the daily scale.

India VIX fell down by 8.14% from 21.16 to 19.44 levels. Volatility has spiked to multi-month high levels signalling wild swings in the market. On the Option front, Maximum Call OI is at 18000 then 19000 strike while Maximum Put OI is at 17000 then 16000 strike. Call writing is seen at 17200 then 17100 strike while Put writing is seen at 17200 then 17000 strike. Option data suggests a wider trading range in between 16750 to 17350/17500 zones.

Bank Nifty opened positive and relatively outperformed the broader market. The banking index bounced well after taking support at its 200 DMA and closed with gains of around 670 points. It made a Bullish candle and an Inside Bar on daily scale.

For weekly Bank Nifty, Maximum Put OI is at 36000 strike and maximum Call OI is placed at 37000 strike. We have seen marginal Call writing in 37000 strike while significant unwinding in 36000 and Put writing is witnessed at 36000 strike. Now it has to cross and hold above 36500, for an up move towards 36750 and 37000 zones whereas support can be seen at 36000 and 35750 zones.

On the sectoral front, apart from profit-booking decline in Pharma stocks, all other sectors traded in the positive territory, out of which Banking and Metal space outperformed the market. 

On stocks front, positive stance was seen in Tata Power, ZEEL, Cummins, Tata Motors, Can Bank, Biocon, Axis Bank, SBIN, MFSL, Tech Mahindra, Reliance Industries, Voltas, Godrejcp, LTI, Aarti Ind, LTTS, TCS and APL LTD while weak structure in Cipla, Glenmark, Dabur, Marico, Divislabs and ACC etc. Now it needs to cross and hold 17200 zones for an up move towards key hurdle at 17350 and 17500 zones whereas support can be seen at 17000 and 16800 zones.

(Shivangi Sarda is a Quantitative Analyst, Derivatives and Technical Research at Motilal Oswal Financial Services. Views expressed are the author’s own. Please consult your financial advisor before investing.)

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