The benchmark Nifty opened a gap up 133.15 points at 8,451. The short-covering by call writers to expiry session for March contracts and welfare measures worth Rs 1.7 lakh crore announced by the Indian government helped the market to gain. The Nifty remained volatile with bullish bias during the whole day and closed at 8,641.45 with a gain of 323.60 points making a Bullish Candle on the daily chart. On the weekly chart, it made a Bullish candle whereas, on the monthly chart, it made a bearish candle. The market needs positive cues from domestic or international markets or strong short coverage to start moving upwards.
The FIIs and DIIs both were net sellers today with a turnover of 484.78Cr and 769.93Cr respectively. Market breadth was positive today with 39 stocks advances and 11 stocks declining from the stack of nifty 50. The closing of Nifty at 8,641.45 is well below 200DEMA at 11,350 but above the daily pivot at 8,136.45. The daily Stochastic is at 53 and RSI is at 36 indicating the market may consolidate or get a bounce-back.
Nifty’s new resistance levels are at 8,749, 8,883, 9,110.68, and 9,390 while the support levels are at 8,451, 8,305, 8,100, and 7,984. The fear gauge (India VIX) has been further decreased to 71.53 with increased ATR of Nifty and Bank Nifty due to fear of uncertainty of the markets which is driving the indices volatile. The daily trading range for the next session as per the Nifty chart seems to be very wide now from 7,984 to 9,390.
Bank Nifty also followed the broader Index and closed at 19,613.90 with a gain of 1,132.85 points making a bullish candle on the daily chart. New resistance levels are at 20,009, 20,409, 20,925, and 21,561.40 while key support levels are at 19,265, 18,782, 18,365, and 18,121. The Trading range for BN looks between 18,121 to 21,561 from the daily chart. The PCR ratio for the current series (1st April 20) is 0.85.
As per Nifty Option Chain data (1st April), Put writing was observed at levels from 7,500 to 9,500 whereas Call writing was seen from 8,500 to 9,500. Unwinding was not observed at the Put as well as at the Call side due to the beginning of the new Options Series (1st April 2020). Max OI in PE is at approx 8,000 and CE is at 9,000. The PCR for the current series is 1.07 which indicates a sideways market with bullish bias in the market. OI data shows the possibility of the next trading range between 8,000 to 9,000 with volatile swings. Traders are advised to be careful from volatility and trade only trends with options strategies with close stops.
Technical analysis with a sound understanding of the market is the key to trading success; however, unexpected (domestic or international) factors make the technical analysis go haywire for a while, hence we have to monitor fresh data and new dynamics of the market during trading hours to consistently make money. We trust the information will be helpful in your own analysis of the market and make trading a profitable and better experience. This analysis has been shared for educational purposes. Please seek your financial adviser’s guidance before trading or investing.
Happy Trading and Keep investing safely!
