9 Dec - Nifty View

In Yesterday's Nifty View, it was given that Wednesday's movement of Nifty looked like a Failed Breakdown, and on a move below 5000, Positional Shorts could be taken. That failed breakout was confirmed today, as Nifty moved below 5000 in the morning trades, and then another 80 points from there, before recovering to close just above its important support of 4930. It made a low of 4921 today, near to the lows made on 1st and 2nd December. A break below this low now can lead to the filling of the gap created on 1st December, and Nifty can slide further 4850/4840 levels. How it reacts at those levels remains to be seen. For now, 5000/5005 should be the immediate stoploss for any Positional Short trades.

The Nifty Option Open Interest charts are given below:

The day was again a low volume one on the Options front, but belonged to the Bears entirely. The Bulls covered 14 lacs+ OI at 5000 PE and 5100 PE strikes. On the other hand, the Bears added a good amount of 29 lacs+ OI from 4800 CE to 5200 CE strikes. The range as per the Option Charts has contracted now, and is now from 4800 to 5100. Between them, 4900 and 5000 are the 50:50 levels.

For tomorrow, immediate resistance for Nifty Spot now comes at 4965 levels. Above this, next resistance levels are 4985 and 5005 levels. A crossover above 5005 can lead to some short covering which can again lead to a test of 5070 and higher levels. However, 5005/5015 will offer a stiff resistance and the Bears are not expected to give i so easily. On the downside, immediate support for Nifty Spot comes at 4915/4910 levels. if Nifty slides below this, it will set it up to fill the Gap created on 1st December, which can take it down towards 4850/4840 levels.

9 Dec - Nifty Spot resistance at 4965-4985-5005-5050. Support at 4910-4885-4850-4820 - www.niftypower.com

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