By Shivangi Sarda
The Nifty 50 index opened flattish on Wednesday and consolidated in a range throughout the day. It respected its previous day’s low levels but could not hold above 17250 zones and closed near its opening levels. It formed a Doji sort of candle on daily scale and has been forming higher highs – higher lows from the last two sessions.
India VIX needs to cool down
India VIX is down by 1.41% from 16.47 to 16.24 levels. Volatility needs to further cool down to 15-14 zones for stability in the market. On the Options front, Maximum Call OI is at 17500 then 17300 strike while Maximum Put OI is at 17000 then 16700 strike. Call writing is seen at 17300 then 17500 strike while meaningful Put writing is seen at 16700 then 17100 strike and unwinding at 16400 strike. Options data suggests a wider trading range in between 17000 to 17350 zones.
Bank Nifty needs to hold above 35,000
Bank Nifty opened flattish and headed towards 35378 marks. However, it failed to hold at higher zones and drifted towards 34900 levels in the last hour of the session. It formed a small bodied Bearish candle on daily scale with longer upper shadow and closed with losses of around 140 points.
For weekly Bank Nifty, Maximum Put OI is at 35000 then 34500 strike and maximum Call OI is placed at 35500 then 36500 strike. We have seen significant Call writing in 36500 while Put writing is witnessed at 35500 strike. Now it has to hold above 35000 zones for it to move up towards 35250 and 35500 zones whereas support can be seen at 34750 and 34500 zones.
On the sectoral front, all the sectors barring Pharma and Auto stocks traded in the negative territory out of which Metal, Media and PSU Banking counters witnessed the most weakness.
Among stocks, positive stance was seen Sun Pharma, Eicher Motor, Lalpath Labs, Ipca Labs, Titan, Apollo Hospital, Escorts, Drreddy, Glenmark and Lupin while weakness in PVR, ABFRL, India Mart, SAIL, Ashokley and NMDC.
(Shivangi Sarda is a Quantitative Analyst, Derivatives and Technical Research, Motilal Oswal Financial Services. Views expressed are the author’s own. Please consult your financial advisor before investing.