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F&O: Bulls & bears in tug of war; Nifty has to hold above 17,300

Nifty opened negative on Thursday, but managed to hold the 17,300 level and moved in a narrow range of 50-70 points throughout the session. It traded inside the trading range of the last session and remained quite choppy as the weekly derivative contracts expired. It formed a small bullish candle on the daily chart and a small bearish candle on the weekly scale, indicating a tug of war between the bulls and bears. Now it has to hold above 17,300 level to extend the move towards 17,500 and 17,777 levels, while on the downside, support was seen at 17,250 and 17,050 levels.

India VIX fell by 3.24% from 14.41 to 13.94 level. India VIX needs to hold below 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 at 17,500 followed by 17,400 levels. There was Call writing at strike prices 18,000 and then 17,700 levels, while there was Put writing at 17,300 and then 17,200 levels. Options data suggested a broader trading range between 17,000 and 17,800 levels while the immediate trading range was seen between 17,200 and 17,500 levels.

Bank Nifty opened flat to negative but remained consolidative in a range of 200-300 points throughout the day. Select banking stocks drove the index, but overall the index moved in a choppy manner and closed with a loss of around 85 points. It formed a small-bodied bearish candle on daily scale with longer shadows. Now it has to cross and hold above 36,750 level to witness a bounce towards 37,000 and 37,250 levels, while on the downside support was seen at 36,500 and then 36,250 levels.

Nifty futures closed flat at 17,370 level. Among specific stocks, the trade setup looked bullish in Metropolis, Indus Tower,

, Indian Hotel, Bharti Airtel, ONGC, Marico, PFC, MCX, Colgate Palmolive, SRF, IEX, , Grasim, Havells, Tata Steel and UBL but weak in Indigo, Apollo Hospital, Astral, and Bajaj Auto.

(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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