16 Dec - Nifty View

Nifty opened below its support level of 4720 today, and gave an intraday scare to traders by sliding towards 4670 levels, before staging a comeback and close near the closing level of yesterday. Today, once again the Bulls managed to save the level of 4700. For how long they can do that, remains to be seen. This was the fifth attempt by the Bears to break this level, which failed. Whether they can do it, remains to be seen. At this time, any close below 4720 should be good for initiating Positional Shorts. On the upside, Resistance remains at 4840/4850 zone and then at 4920 level, and Longs should be attempted only if these levels are crossed.

The Nifty option OI Charts are given below:

On the Options front, there was an addition of 17 lacs+ OI at 4700 CE and 4900 CE strikes by the Bears. Another notable thing is the covering seen by both the Bulls and the Bears from 4800 to 5100 levels. This might be in anticipation of some wild moves due to the RBI policy tomorrow. After today's move, 4900 now becomes a minor resistance for Nifty, while 4700 is the biggest support. The range is 4700 to 5100 for the month.

For tomorrow, immediate resistance for Nifty Spot comes at 4770 levels. Above this, Nifty should target higher level resistances of 4795/4800 and 4840 levels. A breakout above 4840 can bring a mini rally towards 4920 kind of levels. On the downside, support for Nifty Spot comes at 4735/4740 levels. Below this, Nifty will again slide towards 4715-4690 levels. Below 4690, panic can spread among the Bulls, and a break of 4640 can come.

16 Dec - Nifty Spot resistance at 4770-4800-4840-4880. Support at 4735-4715-4690-4670 - www.niftypower.com

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