By Rajesh Palviya
NSE Nifty 50 index witnessed promoting strain all through the week, dragging the index to shut at its lowest level. Nifty closed at 16202 with a lack of 151 factors on a weekly foundation. On the weekly chart the index has fashioned an extended bearish candle forming decrease High-Low in comparison with earlier week indicating weak spot at present ranges.
The chart sample means that if Nifty 50 index breaks under 16000 stage it could witness promoting which might take the index in direction of 15800-15600. However if Nifty crosses and sustains above 16400 ranges it could witness shopping for which might lead the index in direction of 16500-16800 ranges .For the week, we anticipate Nifty to commerce within the vary of 16400-15700 with a destructive bias. The weekly power indicator RSI is shifting downwards and is quoting under its reference line indicating destructive bias .
Nifty 50 Derivative Outlook
Nifty futures closed at 16219 on a destructive be aware with 2.22% lower within the open curiosity indicating Long Unwinding. Nifty Futures closed at a premium of 18 factors in comparison with yesterday premium of three factors. FIIs had been Sellers in Index Futures to the tune of 1729 crore and had been Buyers in Index Options to the tune of 6118 crore, Sellers within the Stock Futures to the tune of 3461 crore. Net Buyers within the by-product phase to the tune of 893 crore. India VIX index is at 19.58 v/s 19.14. Nifty ATM name possibility IV is at the moment 13.80 whereas Nifty ATM Put possibility IV is quoting at 20.38.
Nifty Put choices OI distribution reveals that 16000 has highest OI focus adopted by 16500 & 16300 which can act as help for present expiry. Nifty Call strike 16500 adopted by 16000 witnessed vital OI focus and will act as resistance for present expiry.
Nifty Bank Outlook
Bank Nifty began the week on a flat be aware nevertheless promoting strain all through the week led the index to finish on a weak be aware. Bank Nifty closed at 34484 with a lack of 1130 factors on a weekly foundation. On the weekly chart the index has fashioned a large bearish candle and closed under earlier week’s low indicating weak spot on a brief time period foundation.
The chart sample means that if the index breaks under 34200 stage it could witness promoting which might take the index in direction of 33800-33200. However if Bank Nifty crosses and sustains above 35000 stage it could witness shopping for which might lead the index in direction of 35500-36000 ranges. For the week, we anticipate Bank Nifty to commerce within the vary of 35000-33200 with a destructive bias. The each day and weekly power indicator RSI is in destructive terrain and under its respective reference traces indicating destructive bias.
Nifty Bank Derivative Outlook
Bank Nifty closed at 34555 on a destructive be aware with 13.11% enhance in open curiosity indicating Short Build Up. Bank Nifty Futures closed at a premium of 71 factors in comparison with yesterday premium of 46 factors. Bank Nifty Put choices OI distribution reveals that 35000 has highest OI focus adopted by 34500 which can act as help for present expiry. Bank Nifty Call strike 34500 adopted by 35000 witnessed vital OI focus and will act as resistance for present expiry.
Sectors and shares for this week
We anticipate Automobile, Defense, FMCG, Oil & Gas might appeal to some shopping for curiosity whereas Metal, IT, Banking & NBFC might stay beneath promoting strain. Stocks of TVS Motor Company , Bajaj Auto, Dabur India, ITC, HAL (Hindustan Aeronautics), BEL (Bharat Electronics), ONGC, Coal India, might present some shopping for curiosity.
NSE Nifty 50 buying and selling technique for this week
The technique which we’re suggesting for the week with expiry schedule on sixteenth May 2022 is IRON BUTTERFLY, which entails Selling of 1 lot of Nifty 16,200Call @ 163 & Selling of 1 lot of Nifty 16,200 Put @ 145 and concurrently shopping for one lot of 16,550 Call @ 39 & shopping for one lot of 15,850 put @ 40. Both danger and reward on this technique are restricted and the good points within the technique shall be accrued between two ranges i.e 16,450 on upside & 16,000 on draw back. The Nifty is prone to discover a robust help at 16000 as 16000 put has excessive OI focus whereas upside is prone to be restricted to 16300 or 16500 and finally conclude weekly expiry within the vary of 16,000 to 16,500. Maximum revenue of Rs 11,450 will occur if the Nifty closes or expires at 16,200. On the opposite hand if Nifty expiry shut is above 16,429 (higher bep) or under 15,971 (decrease bep) then most loss incurred shall be Rs 6,050.
(Rajesh Palviya, VP – Research (Head Technical and Derivative) at Axis Securities. Views expressed are the writer’s personal.)
Source: www.financialexpress.com”