24 Nov - Nifty View

In Yesterday's Nifty View, it was given that "... support for Nifty Spot comes at 4785/4780 levels. If breaks and sustains below this, then a test and break of 4700 on Expiry will be on the cards, with minor supports at 4760 and 4720 levels...". Nifty opened below 4780, immediately went till 4738, came up again to test 4760 again, and then declined to make a low at 4640 levels, before recovering and closing above 4700 levels. Having a trading plan and levels at which to trade before the market, helps in tiding over the intraday volatility. After today's move, Nifty has broken the Yearly Low. This would have turned another Lot of Bulls to Bears. The trend remains down. We have a handful of levels to watch, if Nifty tries to have a relief rally. On the downside, there are no more support levels, but broad support zones left. Nifty will be forming and giving some supports levels in the coming days to trade.

The Nifty Option Open Interest charts are given below:

One day before the Expiry, one would generally not expect any major Option writing to happen. However, the opposite can be seen from the Option Charts. The Bulls added a huge amount of 45 lacs+ OI from 4600 CE to 4800 CE strikes, the maximum being at 4700 CE. The Bears also added 8 lacs+ OI at 4600 PE, but covered at higher strikes. Whether the exuberance shown by the Bulls today pays or backfires, has to be seen tomorrow. But such a huge amount of OI addition one day before the expiry is definitely not smart trading.

For tomorrow, immediate resistance for Nifty Spot comes at 4715/4720 levels. Above this, it will head higher to test resistances at 4760 and 4780 level. On the downside, support exists at 4680/4675 levels, below which, it will slide again towards todays low of 4640. Below 4640, 4580 will be the target for the Bears. As tomorrow is Expiry, trade light and only at the levels with tight stoplosses.

24 Nov - Nifty Spot resistance at 4720-4745-4780-4810. Support at 4680-4640-4620-4580 - www.niftypower.com

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