12 Sep: Nifty View

Nifty once again failed to cross and close above the strong resistance zone of 5180-5230, and declined more than 90 points on Friday. The Option OI Charts on Friday indicated a downmove, and we got it. Now the next level of supports at 5030 and 4980 are to be watched on Monday. If Nifty closes below these on Monday, the downfall would be assumed to have restarted, and short trades will be preferred.

The Nifty Option Open Interest Charts are given below:



The Bulls would have sensed the impending downfall. The covered 15 lacs+ OI at 5000 PE and below strikes, maximum being at 4900 PE with 8 lacs + OI cut. On the other hand the Bears added a huge amount of 12 lacs+ OI at 5100 CE strikes. The range as per the Options table is 4900 to 5200, with 5000 being a minor support, and 5100 being a minor resistance.

For tomorrow, watch the levels of 5030 and 4980 on Nifty Spot on the downside. Intraday trend will remain negative till Nifty stays below 5030 level. Sell on all rallies below 5030 for targets of 4980 and 4940. However, if it manages to trade and sustain above 5030, then it may recover upto 5080-5085 levels, where again selling pressure will emerge. If manages to sustain above 5085, then a small short covering rally will be seen for 5100+ levels.

12 Sep: Nifty Spot resistance at 5055-5085-5110-5135. Support at 5030-5000-4980-4960 - www.niftypower.com

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