F&O: Nifty needs to hold above 10,430 to move towards 10,620 levels

By Chandan Taparia

NEW DELHI: The Nifty50 opened positive and witnessed sustain buying interest till the end of the session. It rallied more than 100 points from 10,400 to 10,500 zones by surpassing its immediate hurdle at 10,430 mark.

The index formed a Bullish candle on the daily scale and a Dragonfly Doji on the weekly chart. This indicates that bulls are back in the market after the decline of last three weeks.


Now, it has to continue to hold above 10,430 zones to extend its move towards 10,550 and then 10,620 levels, which is 38.20 per cent retracement of the entire down leg from 11,171 to 10,276. While on the downside, supports are seen at 10,400 and 10,333 levels.

On the option front, maximum put open interest is at 10,000 followed by 10,400 strike, while maximum call open interest is at 10,700 followed by 10,500 and 11,000 strike. Fresh call and put activities was seen in most of the near the money strikes, and option band signifies a broader trading band between 10300 and 10650 zones.

India Vix fell 4.25 per cent at 14.20. VIX has declined by more than 13 per cent this week, which has given a short-term stability to the market.

Bank Nifty rallied more than 300 points and negated its formation of lower highs lower lows of last six trading sessions. It formed a bullish candle on daily and a Dragonfly Doji on the weekly scale, which has a bullish implication to extend its bounce back move. It has to continue to hold above 25,250 zones to extend its move towards 25,500 then 25,750 while on the downside support exists at 25,000 then 24,750 levels.

Nifty Futures closed with a gain of 1.13 per cent at 10,507. Builtup of long position were seen in Mindtree, Hexaware, BEL, IDBI Bank, Vedanta, Jain Irrigation, IGL, Tata Elexsi, Britannia and Tech Mahindra, while shorts were seen in Siemens, Asian Paints and PNB.

(Chandan Taparia is Technical & Derivative Analyst at Motilal Oswal Securities. Investors are advised to consult financial advisers before taking an investment calls based on these observations)