Nifty opened gap down today at our second support level near 4980, went down to make a low of 4911, and closed right near support levels of 4942. The trend has clearly turned don, and now as long as it trades below 5030/5050, sell on all rallies should be the mantra of the traders.
The Nifty option Open Interest charts are given below:
There was a lot of covering that happened both by the Bulls and the Bears today. Open Interest addition was done by the Bears at 4900 CE and 4800 CE strikes, while the Bears did so at 4700 PE and 4900 PE strikes. After today's move, the range as per the Option table has moved down and is now at 4800 to 5200. 4900 is a minor support, 5100 is a minor resistance, and 5000 is the 50:50 level now. Any pullbacks, should be limited to 5000-5030 now, else Nifty will again test 5100+ levels.
For tomorrow, immediate resistance for Nifty Spot will now come at 4965-4980 levels. Staying above these, Nifty will attempt 5000+ levels, facing resistance at 5030 and 5050. Only a sustained trade above 5050 will now favor bulls, otherwise sell into all rallies. On the downside, support for Nifty Spot comes at 4905 level. If stays below this, lower level supports come at 4885-4855 and 4830 levels.
13 Sep: Nifty Spot resistance at 4965-4980-5010-5035. Support at 4930-4905-4885-4855 - www.niftypower.com
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