7 March - Nifty View

Nifty had an extremely volatile day today, with the UP Election Result News weighing on the market. Based on the initial reaction of the market, it has given an initial thumbs down to the results. Whether this downmove is going to sustain and results in a downtrend remains to be seen. As of now, consider the trend as down till the time Nifty does not give a close above 5320/5330 Spot. There was huge volumes traded in nifty futures today. The next move of Nifty will give indications as to whether these volumes contained fresh Shorts or fresh Longs. Also, it is going to be a holiday truncated week. Hence, it is better to stay on the sidelines now and wait for next trade setup to emerge.

The Nifty option OI Charts are given below:

On the Options front, the Bears added small amounts to their positions, by adding 14 lacs+ OI from 5200 CE to 5500 CE strikes. The Bulls covered a small amount at 5200 PE and above strikes, but added a huge amount of 9 lacs+ OI at 5000 PE strike. Overall, 5600 levels is beginning to look like a decent resistance now from the Options Charts. The level of 5200 is still the biggest support level, below which, the next important support comes at 5000 level. 5400 is the 50:50 level as of now.

For tomorrow, immediate resistance for Nifty Spot comes at 5255/5260 levels. Staying above this, the Bulls will again try and lift nifty towards 5290 and 5325 levels. 5325 level can now be taken as a short term trend deciding level on closing basis, above which, we can see a short covering rally for 5400+ levels. On the downside, support for Nifty Spot comes at 5220 levels, below which, the 200 DMA near 5175 levels will be targeted by the Bears. Break of 5175 can lead to further downsides towards 5145 and 5120 levels.

7 March - Nifty Spot resistance at 5260-5290-5325-5370. Support at 5220-5175-5145-5120 - www.niftypower.com

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