On Monday, Nifty opened flat, and after an initial hiccup, continued its upward journey to close near 5850 level. After reaching oversold levels and touching the support near 5700, Nifty has completed a 150+ point rally today. There are many indicators pointing to a new Bullish move from here. Nifty has corrected quite a bit from the Overbought levels and now reached Oversold levels on Daily Charts. There is also a Bullish Wolfe Wave pattern forming on Daily Charts, although not a perfect one. The biggest hurdles for the Bulls will be the immediate resistance at around 5890 Nifty Future level. If the Bulls manage to break this level, then this rally will become more believable. Till then, we prefer intraday trades or hedged Positional trades only.
The Nifty Option Open Interest Charts are given below:
On the Nifty Options front, the Bears retreated a it from 5700 level, covering 6 lacs+ Open Interest at 5600 CE strike. The Bulls added small quantity Nifty Put Options of 5700 PE and 5800 PE. Overall, in the Nifty Options Open Interest Chart, the levels of 5800 and 5900 appear to be the level at which the fight for supremacy between the Bulls and the Bears is going on. 5700 to 6000 seems to be the broad trading range in Nifty at the time being. Lets see how these levels of 5800 and 5900 resolve in the coming days.
For tomorrow, immediate resistance for Nifty Future comes at 5860 and then at 5890/5905 levels. Trading above these, can lead to a short covering rally, which can take Nifty Future towards 5935-5975 levels. On the downside, support for Nifty Future comes at around 5830 level. Below this, next supports for Nifty Future comes at 5800-5770 and 5750 levels. The immediate trend is up and Buy on Dips should be the strategy as long as Nifty Future stays above 5830 tomorrow.
18 June - Nifty Future resistance at 5860-5890-5905-5935. Support at 5830-5800-5770-5750 - www.niftypower.com
P.S.:
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