17 Nov - Nifty View

On Wednesday, Nifty almost broke down below 5000, before making a volatile recovery and managing to close near the Tuesday's close. As given yesterday also, this is not the time to enter into fresh Positional Shorts. Instead, wait to see how Nifty reacts at 5000/4980 on the lower end, and at 5130/5150 on the higher end. Any trade near these levels can safely have a Stop and Reverse of 20 Points. Between these levels, the Bulls and Bears are expected to fight it out over the next few days. Till we get a breakout from these levels, tight intraday trades can be taken to take advantage of the volatility.

The Nifty Option Open Interest charts are given below:

The Option open Interest Charts turned a bit more Bearish today. On a day when nifty showed good recovery, one would expect a neutral or a Bullish addition in the charts. Instead, the Bulls covered a huge amount of 45 lacs+ OI between 4800 PE to 5400 PE strikes. The maximum amount of covering was done at 5100 PE strike. On the other hand, the Bears continued to dominate, by adding a huge amount of 17 lacs+ OI at 5000 CE strike. Between 4800 CE and 5400 CE, the Bears added 30 lacs+ OI. After today's move, there is some amount of weakening in the support at 5000, although it still remains the biggest support for this series. 5100 is the battlezone level between the Bulls and the Bears. 5200 and above are the resistances.

For tomorrow, immediate resistance for Nifty Spot comes around 5080/5085 levels. Above this Nifty can go on to test the strong resistance zone of 5130/5150. Any reasonable short covering move should come only above 5150 now. On the downside, immediate support for Nifty Spot comes at 5030/5010 zone. Below these, 4985 is likely to be tested again. Below 4985, panic can take the market down towards 4945 and below levels.

17 Nov - Nifty Spot resistance at 5085-5110-5130-5155. Support at 5030-5010-4985-4945 - www.niftypower.com

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