Nifty index opened positive and witnessed sustained buying interest till the end of session and registered a highest daily close in last one year. It has crossed an immediate hurdle of 8,665 zones and closed the week on a cheerful mood.
The index has negated the negative formation of making lower highs of last three sessions by crossing 8,600 zones and rallied towards 8,700 zones with an intraday gains of around 130 points. Now it has to continue to hold above 8,635-8,665 zones to witness a fresh rally towards 8,750-8,777 zones while on the downside support exists at 8,600 then 8,520 zones. India VIX fell down by around 12 per cent in last two sessions post GST pass out and lower volatility is supporting the positive sentiment with comfort to put writers.
On the option front, maximum Put OI is at 8500 followed by 8600 strike while maximum Call OI is at 9000 followed by 8800 strike. We have seen fresh Put writing at 8600 followed by 8500 and 8400 strike while Call unwinding in all the higher strike especially in 8700 strike is giving the scope to head towards higher levels. Shift in Put writing and Call unwinding is supporting the positive outlook of the market going forward.
Bank Nifty managed to hold near to 18500 zones and headed towards 19000 zones. It has to hold above 19000 zones with follow up buying interest to head towards 19250-19300 then 19500 zones while 19500 is likely to act as a major support.
(The author is derivatives analyst, equity research at Anand Rathi Financial Services)