Nifty (8659.90, +73.65, +0.86%)
An initial consolidation that lasted till 11:38 hrs in the morning when the Nifty touched the intraday low of 8573.75; thereafter, we had a huge rally of nearly 100 points up to 8667.55 only to close just 8 points lower at 8659. During the process, the market saw short covering in the index as well—both in the front month Nifty future and in the call options of 8600, 8500 and 8400 in good quantities while the put options starting from 8200-strike saw substantial fresh open interest addition. Thus, the bulls were in the driver’s seat and the bears were typically on the back foot as in similar occasions. That the Nifty closed above the 8630-mark is in itself a positive sign yet we need to see a second successive close above this level in today’s session to show the indications of continued strength.
It remains to be seen as to how the Nifty behaves post the monetary policy announcement today—if it continues to show sustained strong buying then this rally would gather the much required strength to morph in to a nascent uptrend. Any failure to post a close above the 8700-mark would be a red-flag event in that it would signal the possible tapering off of the upward momentum. And a close below the 8650-mark after opening with a gap up would be a fresh invitation to the short sellers.
An initial consolidation that lasted till 11:38 hrs in the morning when the Nifty touched the intraday low of 8573.75; thereafter, we had a huge rally of nearly 100 points up to 8667.55 only to close just 8 points lower at 8659. During the process, the market saw short covering in the index as well—both in the front month Nifty future and in the call options of 8600, 8500 and 8400 in good quantities while the put options starting from 8200-strike saw substantial fresh open interest addition. Thus, the bulls were in the driver’s seat and the bears were typically on the back foot as in similar occasions. That the Nifty closed above the 8630-mark is in itself a positive sign yet we need to see a second successive close above this level in today’s session to show the indications of continued strength.
It remains to be seen as to how the Nifty behaves post the monetary policy announcement today—if it continues to show sustained strong buying then this rally would gather the much required strength to morph in to a nascent uptrend. Any failure to post a close above the 8700-mark would be a red-flag event in that it would signal the possible tapering off of the upward momentum. And a close below the 8650-mark after opening with a gap up would be a fresh invitation to the short sellers.
- Most critical levels for the day: 8629 (downside) & 8696 (upside)
- Strong support: 8629 – 8593 – 8566
- Strong resistance: 8696 – 8734 – 8748
- Major support: 8526 – 8500
- Major resistance: 8744 – 8777 - 8789
Bank Nifty (18605.45, – 12.40, -0.067%)
While the Nifty went on to post strong gains this index, which generally takes leading charge, had been pretty lackluster and closed almost flat after losing just 12 points over the previous session. This does not augur well for the bulls since for how long you would see a rally devoid of support from the banking sector. Today, being the big day for the banking sector with the central bank going to announce the bimonthly monetary policy review statement there could well be very high volatility. Thus, crossing the 18810-mark and staying above that would be quite important for the index bulls. Any correction during the day should not see the index sliding below 18537 through 18510 support area. A close below the 18500-mark might as well signal the onset of a fresh round of weakness.
- Most critical levels for the day: 18810 (upside) & 18537 – 18510 (downside)
- Strong support: 18537 – 18510
- Strong resistance: 18702 – 18810
- Major support: 18510 – 18445 – 18357
- Major resistance: 18911 – 19010 - 19500
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 An initial consolidation that lasted till 11:38 hrs in the morning when the Nifty touched the intr...){kind=link}
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