In the last two days, it looks like bulls have tightened their grip on D-Street as Nifty is finding support at lower levels.
The Nifty which started with a gap-up on Thursday reclaimed its crucial resistance level of 10,800 on an intraday basis but failed to close above the same. The index still made a bullish candle on the daily charts and Supertrend indicator signals a buy which is a bullish sign.
The Nifty failed to close above the crucial resistance mark of 10,800, and 10,770 levels on closing basis as traders prefer to book profits at higher levels.
But in the last two days, it looks like bulls have tightened their grip on D-Street as Nifty is finding support at lower levels. The next target for Nifty is placed at 10,920 only if it manages to close above 10,820.
‘Supertrend’ which is a trend following indicator just like Moving Averages and MACD (Moving Average Convergence Divergence) signaled a buy which is a bullish sign for D-Street. It is plotted on prices and their placement indicates the current trend. The MACD also witnessed a bullish crossover in Thursday’s session.
The Supetrend indicator gave a sell call on May 21, 2018 and the index made a low of 10,417 on 23rd May 2018 before bouncing back towards 10,700 levels.
The Nifty index has a strong support near 10,600, 10,650 and 10,730 levels. If the index breaks 10,698 levels in the forthcoming sessions, there is a higher probability that bears could make a comeback.
The Nifty which opened at 10,722 rose to an intraday high of 10,818. The index failed to close near its intraday high and closed 83 points higher at 10,768.
“Albeit price patterns are looking bullish with strong gap-up opening in Nifty and other major indices the fact that at the end of the day, Nifty closed below the mid-point of intraday trading range is suggesting the domination of bears at higher levels,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.
“As a consequence of this kind of price behaviour we are seeing long upper shadows on indices which are somewhat bearish in nature. Hence, if Nifty trades below 10,722 levels for atleast one hour on Friday then it may set the tone for profit booking in the coming sessions,” he said.
Mohammad further added that technically speaking more weakness can be seen if Nifty closes below 10,698 levels whereas trend reversal in favour of bears will be confirmed on a close below 10,587 levels. “Contrary to this a close above 10,820 levels shall resume the strength on the upside with an initial target of 10,920,” he said.
India VIX moved up by 1.81 percent at 12.55 levels. Overall, lower volatility with higher Put Call Ratio suggests an overall bullish bias of the market.
We have collated the top 15 data points to help you spot profitable trades:
Key Nifty support and resistance levels
The Nifty closed at 10,768.3 on Thursday. According to Pivot charts, its key support is placed at 10,721.27, followed by 10,674.23. If the index starts moving upward, key resistance levels to watch out are 10,816.67 and 10,865.03.
Nifty Bank
The Nifty Bank index closed at 26,517.8. The important Pivot level, which will act as a crucial support for the index, is placed at 26,412.17, followed by 26,306.53. On the upside, key resistance levels are placed at 26,695.17, followed by 26,872.53.
Call options data
In terms of open interest, the 11,000 call option has seen the most call writing so far, with 39.98 lakh contracts being written. This level could act as a crucial resistance for the index in the June series.
The second-highest buildup was seen in the 10,800 call option, which has seen 29.99 lakh contracts getting written so far. The 10,700 call option has accumulated 28.17 lakh contracts.
The most call writing was seen at the strike price of 11,100, which saw 2.25 lakh contracts getting written.
Call unwinding was seen at the strike price of 10,800, which shed 4.01 lakh contracts, followed by 10,700, which shed 2.91 lakh contracts as well as 10,600, which shed 2.69 lakh conracts.
Put options data
Maximum open interest in put options was seen at the 10,600 strike price, in which 43.28 lakh contracts have been added till date. This level could be a crucial support for the index in the June series.
The 10,200 put option comes next, with 34.12 lakh contracts being added so far, followed by the 10,500 put option, which has now accumulated 33.44 lakh contracts.
Maximum put writing was seen at the strike prices of 10,700, which added 10.13 lakh contracts, followed by 10,800, which added 7.08 lakh contracts, and 10,600, which added 2.8 lakh contracts.
Put unwinding was seen at the strike price of 10,200, which shed 1.71 lakh contracts, followed by 10,500, which shed 1.13 lakh contracts.
FII and DII data
Foreign institutional investors (FIIs) sold shares worth Rs 525.4 crore, while domestic institutional investors bought shares worth Rs 1,197.89 crore in the Indian equity market, as per provisional data available on the National Stock Exchange.
Bulk deals:
Ashiana Housing: Goldman Sachs India Fund sold 1,400,000 shares at Rs 147.02 per share. Century Textiles: Cygnet Industries Limited sold 1,289,364 shares at Rs 933.5 per share. Sharda Crop: Goldman Sachs India Fund Limited sold 685,000 shares at Rs 400.09 per share
Analyst or board meet/briefings:
Gruh Finance: The firm participated in a JM Financial conference on June 7, 2018.
Endurance Technologies: The company will be having a investor conference call with Citi Group on June 8, 2018.
Stocks in the news:
PTC India: Sutirtha Bhattacharya appointed as the Independent Director on the Board.
HDFC Bank Raises MCLR Across Tenors By 10 bps
Two stocks under ban period on the NSE
Securities in ban period for the next day’s trade under the futures and options segment includes companies in which the security has crossed 95 percent of the market-wide position limit.
For June 8, Balrampur Chini and DHFL are present in the the F&O ban list.
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