scorecardresearch

Nifty’s immediate hurdle at 17500, Bank Nifty support at 36000 this F&O expiry week; use declines to buy

Aconsiderable OI concentration is built on the 17500 call option, which could be seen as an immediate hurdle for the index Nifty 50

Nifty, Bank nifty
We have observed long addition in the benchmark index Nifty, while the banking space has seen some short-covering as per the F&O data. Image: Pixabay

By Sameet Chavan

Wednesday’s respite was followed by a decent gap up opening yesterday on the back of positive cues from most of the global peers. As the day progressed, the overall participation from some of the missing heavyweight pockets like IT, Auto and Banking increased to a great extent. As a result, we witnessed a good sustained upward move throughout the day to eventually conclude the penultimate weekly expiry around 17400 by adding another 1.50% to the bulls’ kitty.

Markets had a fierce sell off during the last hour of Tuesday and since it looked a bit abnormal one, we refrained from changing our bullish stance. With Thursday’s spectacular move, this view is clearly validated and the way we closed around the highest point of the day, which augurs well for the bulls. For the coming session, 17450 is the immediate level to watch out for and the moment we surpass this, Nifty 50 would continue its march towards 17600 – 17700. On the flipside, 17300 followed by 17200 are likely to provide an immediate cushion. Traders are advised to use declines to buy into and should continue to focus on thematic moves.

As far as Bank Nifty is concerned, we witnessed sheer underperformance during the early part of the week as it kept sulking along with IT space. On Thursday, finally some buying interest was visible in some of the heavyweight names, which is an encouraging sign. Although, we are not completely out of the woods for banking index, we are still hopeful of holding the key support of 36000. The moment it surpasses the 37000 mark, the banking would take the charge from thereon. Apart from this, a lot of individual names are doing well and hence, traders can keep a tab on traders’ favourite counters like Jubilant FoodWorks, Bandhan Bank from a momentum perspective. Also, Polycab India is well poised to give some decent returns. The Metal space looks a bit weak and hence, one should avoid going long for a while.

We have observed long addition in the benchmark index Nifty, while the banking space has seen some short-covering as per the F&O data. On the options front, a substantial pile-up is seen at the 17300-17200 put strikes, indicating it to provide a cushion from any fall. While on the contrary, a considerable OI concentration is built on the 17500 call option, which could be seen as an immediate hurdle for the index Nifty 50.

(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.)

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.

Most Read In Cafeinvest