F&O: Nifty breaks out consolidation phase; showing a clear bullish bias

Nifty opened flat on Wednesday but managed to hold its opening level and made yet another record all-time high at the 17,532 level. The index witnessed sustained buying interest throughout the day at every small decline and pulled Nifty towards a new high territory. It saw the highest ever daily close and settled with a gain of around 140 points. The index formed a perfect bullish candle on the daily scale and saw a breakout from its consolidation phase of the last few sessions. Now it has to continue to hold above the 17,500 level to extend the move towards 17,777, while on the downside support was seen at 17,400 and 17,250 levels.

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

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

Bank Nifty opened negative but took support near the 36,500 level and headed towards 36,950 level. It saw good momentum in the latter part of the session and closed with a gain of around 250 points. It formed a Bullish candle on the daily scale and saw the highest daily close in the recent times above the key hurdle at 36,850 level. Now the index has to hold above the 36,750 level to witness a bounce towards the 37,250 level, while on the downside support was seen at 36,500 and then 36,250 levels.

Nifty futures closed positive with a gain of 0.88 per cent at 17,538 level. Among specific stocks, the trade setup looked bullish in NTPC, SRF, Tata Power, Bharti Airtel, Mindtree, Coal India, Mphasis, ONGC, MFSL, Metropolis, Titan, BEL, Tata Chemicals, Hcl Tech, Ashok Leyland, SBIN, PNB, Bata India, Dr Lal PathLab, ABFRL, M&M Fin, Hindalco, TCS, Infosys, IndusInd Bank, LT, Godrej Consumer Products and Jubilant FoodWorks while weakness in Concor, McDowell, SunTV and MGL.

(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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