Nifty could see 100-150 point bounce; first hurdle near 11,250

Mumbai: The Nifty is set to trade in a narrow range of 10,844-11,256 in the initial part of the week, with a bias toward the upper end. Option sellers have written a straddle — sold a call and put at 11,050 — Friday, which shows the index could trade 1.9 per cent above or below Friday's close of 11,050. The straddle is for weekly expiry on October 1.

The writers expect the index to face resistance near 11,235 — the Nifty’s 40-day moving average. On the lower end, they expect 10,844 to hold. On Thursday, the index hit a low of 10,790.2, which was close to the 200-DMA of 10,757. “The hurdles, for now, are the 40- and 20-DMAs (11,354),” said Rohit Srivastava, founder, IndiaCharts.

Chandan Taparia, analyst at Motilal Oswal, has initiated a bull call spread, expecting a 150-point upside move from Friday close. Taparia feels the market will be “sell on rise”, with banking being a laggard.