F&O: Nifty looks all bullish; bank stocks end underperformance

Nifty on Thursday opened positive and touched yet another record high of 17 644 level. The bulls have been driving the index and sustaining buying interest at higher levels. The index saw the highest-ever daily close above 17,600 and settled with the gain of around 110 points. It formed a bullish candle on the daily scale and has been forming higher highs since the last three sessions. Now it has to continue to hold above 17,600 level to extend the move towards 17,700 and 17,777, while on the downside support has shifted higher to 17,500 and 17,300 levels.

India VIX moved up 1.10 per cent from 13.58 to 13.73 level. India VIX needs to hold below the 13 level to continue the bullish momentum.

On the options front, maximum Put Open Interest stood at 17,000 followed by 16,500 levels, while maximum Call OI was seen at 17,500 followed by 17,300 levels. There was Call writing at 17,900 and then 17,600 levels while Put writing was seen at 17,400 and then 17,300. Options data suggested a broader trading range between 17,200 and 17,800 levels and the immediate trading range between 17,350 and 17,700 levels.

Bank Nifty opened positive and saw a breakout from its consolidation range. Banking stocks outperformed the market after a long period of underperformance. It crossed the 37,700 level and closed near the day’s high with a gain of 820 points. It formed a strong bullish candle on the daily scale and saw the highest-ever daily close. Now it has to hold above the 37,700 level to witness a bounce towards the 38,000 level while on the downside support was seen at 36,900 and then 36,500 levels.

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Nifty futures closed positive with a gain of 0.88 per cent at the 17,538 level. Among specific stocks, the trade setup looked bullish in Idea, Indus Tower, IndusInd Bank, ITC, Cholamandalam Investment and Fin Co, SBIN, Canara Bank, Shriram Transport Fin Co, HPCL, Kotak Bank, Aarti Industries, ICICI Bank, IOC, Reliance, Axis Bank, Hero Motocorp and Apollo Hospital but weak in Lupin, ACC, SunTV, Ramco Cement, Grasim, Jindal Steel, McDowell and Colgate-Palmolive.

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



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