21 Nov - Nifty View

Nifty opened at the important level of 4900 on Friday, but broke it and then steadily sold off to make a low near its supprt level of 4840. Thereafter, it made a good recovery to finish the day above 4900 level. The Daily Candle formed depicts a Bullish picture for Monday if Nifty manages to stay above the close of Friday. Also, the oscillators are at oversold levels and we may see a technical bounce towards higher levels. However, use this bounce to slowly build Short Positions upto 4990/5000 level, with a Stop and Reverse above 5050 Nifty Spot. As long as Nifty is trading below 5050, there is more possibility of a decline towards 4700 than a retest of higher levels.

The Nifty Option Open Interest charts are given below:

Although we saw some recovery on Friday, the Option Charts turned a little more Bearish. The Bulls seemed to have backed off, as they covered a huge amount 45 lacs+ OI from 4900 PE to 5200 PE strikes. The confidence, if any was shown in addition of 27 lacs+ OI at 4700 PE and 4600 PE strikes. The Bulls, on the other hand, moved one strike lower and added a huge amount of 15 lacs+ OI at 4800 CE. After the move of Friday, 4900 has now become the new 50:50 level between the Bulls and the Bears. The immediate range is 4800 to 5100.

For tomorrow, immediate resistance for Nifty Spot now comes at 4920/4930 levels, above which, it short covering can pull it up towards 4975 levels. The zone of 4975-5005, if reached, will be a re-selling zone to build positional shorts, with Stop and Reverse above 5050 on closing basis. On the downside, support for Nifty Spot now comes at 4860/4885 levels. Below this, it will slide to test Friday's low of 4845/4840. Below Friday's low, we may see panic selling for sub 4800 levels on Nifty.

21 Nov - Nifty Spot resistance and 4925-4960-4975-5005. Support at 4885-4860-4840-4810 - www.niftypower.com

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