By Rajesh Palviya
On the each day chart, the NSE Nifty 50 index fashioned a large bearish candle and has closed beneath earlier session’s low indicating destructive bias. The index is shifting in a Lower Top and Lower Bottom formation on the each day chart indicating destructive bias. The chart sample means that if Nifty 50 crosses and sustains above 16800 degree it could witness shopping for which might lead the index in direction of 16900-17000 ranges. However if the index breaks beneath 16600 degree it could witness promoting which might take the index in direction of 16500-16300. Nifty is buying and selling beneath its 20, 50, 100, and 200-day SMA which signifies destructive bias within the quick to medium time period. Nifty continues to stay in a downtrend within the quick to medium time period, so promoting on rallies continues to be our most well-liked technique.
The each day energy indicator RSI is shifting downwards and is quoting beneath its reference line indicating destructive bias.
Nifty 50 Derivative Outlook
In Nifty present sequence there was a Short Build Up witnessed with lower in worth of -0.10% and improve in OI by 26% as of Wednesday whereby there was addition of twenty-two.40 lakh shares in OI, growing from 85.15 lakh to 107.56 lakh shares. Nifty present month rollover stands at 17.13% as of Wednesday. Nifty Put Call Ratio, a sentiment indicator utilized by merchants to gauge the market sentiment and temper, is at the moment at 0.65 in comparison with 1.36 of final week, which is form of oversold at decrease ranges and would possibly increase for a small bounce again.
India VIX, a market volatility indicator usually referred to as the worry gauge, is at the moment buying and selling 21.88% in comparison with 19.38% of final week. Implied Volatility of Nifty ATM choices for the present sequence is at 23.03% in distinction to 18.48% of final week, indicating unstable motion on both sides within the expiry session.
Nifty Put choices OI distribution exhibits that 16,500 has highest OI focus adopted by 16,600 & 16,400 which can act as assist for present expiry and on the Call entrance 17,000 adopted by 16,900 & 16,800 witnessed important OI focus and will act as resistance for present expiry. In weekly choices there was Call writing seen at 16,900 strike adopted by 16,800 & 17,000 whereas on the Put aspect noticeable exercise of writing was witnessed in 16,500,16,600 & 16,700 strike costs. Options information counsel an instantaneous buying and selling vary between 17,800 and 17,300 ranges.
Nifty Open Interest Concentration
Nifty Option OI Change
Bank Nifty Outlook
On the each day chart, Nifty Bank index fashioned an enormous bearish candle and has violated a number of day assist of 35500 indicating destructive bias. The index is shifting in a Lower Top and Lower Bottom formation on the each day chart indicating destructive bias. The chart sample means that if Bank Nifty crosses and sustains above 35500 degree it could witness shopping for which might lead the index in direction of 35800-36000 ranges. However if the index breaks beneath 35200 degree it could witness promoting which might take the index in direction of 35000-34600. Bank Nifty is buying and selling beneath 20, 50, 100 and 200 day SMA indicating destructive bias within the quick to medium time period. Bank Nifty continues to stay in a downtrend within the quick to medium time period, so promoting on rallies continues to be our most well-liked technique.
The each day and weekly energy indicator RSI is shifting downwards and is quoting beneath its reference line indicating destructive bias.
Nifty Bank Derivative Outlook
In present sequence there was a Short Addition witnessed in Bank Nifty Fut with an lower in worth of -3.17% and improve in OI by 16.20% as of Wednesday, whereby there was addition of 4.08 lakh shares in OI, growing from 25.20 lakh to 29.28 lakh shares. Bank Nifty Current sequence rollover stands at 7.53% as on right now, whereas Bank Nifty Put Call Ratio a sentiment indicator utilized by merchants to gauge the market sentiment and temper, is at the moment at 0.53 in comparison with 0.92 of final week indicating a possible bounce again.
Bank Nifty Put choices OI distribution exhibits that 35,000 has highest OI focus adopted by 34,000 & 34,500 which can act as assist for present expiry and on the Call entrance 36,000 adopted by 36,200 & 36,500 witnessed important OI focus and will act as resistance.
In weekly choices Call writing seen at 36,000, 36,500 & 36,200 strike whereas on the put aspect it was seen at 35,000 , 35,200 & 34,500 Options information indicated an instantaneous buying and selling vary between 37,000 and 38,000 ranges.
Bank Nifty Open Interest focus
Bank Nifty OI change
NSE Nifty 50 buying and selling technique for weekly F&O expiry day
The technique which we’re suggesting for the weekly expiry scheduled on twelfth May is a Bearish technique particularly PUT LADDER, which includes shopping for of 1 lot of Nifty 16,700 PUT @ 238 and promoting of 1 lot every of 16,450 PUT @ 144 & one lot of 16,200 PUT @ 79. Put Ladder is a restricted revenue and limitless danger technique; which is an extension to the Put unfold and to additional carry down the price of the technique (Net premium) yet another additional leg of OTM PUT is offered and therefore any transfer beneath the offered leg can incur limitless loss.
The most revenue of Rs 11,750 shall be attained at 16,450 ranges, whereas technique will begin making a loss beneath 16,000. The value of the technique includes outflow of Rs 750 which is the utmost loss if Nifty closes & stays above 16,685 ranges on expiry, nevertheless any sharper motion on decrease aspect may lead to losses and, as an additional put has been offered it’s advisable to exit the technique in whole to keep away from limitless losses beneath 15,950. Break Even factors of the technique are 16,685 on upside & 15,735 on the decrease aspect.
(Rajesh Palviya, VP – Research (Head Technical & Derivatives), Axis Securities. Views expressed are the writer’s personal.)
Source: www.financialexpress.com”