By Rajesh Palviya
Nifty prolonged bearish sentiments for many a part of the week dragged it decrease to shut in adverse territory. NSE Nifty 50 index closed at 15782 with a lack of 629 factors on a weekly foundation. On the weekly chart, the index has fashioned a protracted 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 crosses and sustains above 16000 degree it will witness shopping for which might lead the index in direction of 16400-16700 ranges. However if the index breaks under 15650 degree it will witness promoting which might take the index in direction of 15400-15100 ranges. For the week, we count on Nifty to commerce within the vary of 16300-15200 with a adverse bias .The every day and weekly power indicator RSI is shifting downwards and is quoting under its reference line indicating adverse bias.
Nifty 50 Derivative Outlook
Nifty futures closed at 15786 on a adverse notice with 10.16% lower within the open curiosity indicating Long Unwinding. Nifty Futures closed at a premium of 5 factors in comparison with the day before today premium of three factors. FIIs had been Buyers in Index Futures to the tune of 2860 crore and had been Sellers in Index Options to the tune of 1198 crore, Buyers within the Stock Futures to the tune of 533 crore. Net Buyers within the by-product section to the tune of 1889 crore.
India VIX, the volatility index, is at 23.49 v/s 24.36. Nifty ATM name choice IV is presently 24.22 whereas Nifty ATM Put choice IV is quoting at 25.82. Index choices PCR is at 0.73 v/s 0.63 & F&O Total PCR is at 0.79.
Nifty Put choices OI distribution exhibits that 15800 has highest OI focus adopted by 15500 & 15700 which can act as help for present expiry. Nifty Call strike 16000 adopted by 16300 witnessed important OI focus and should act as resistance for present expiry.
Bank Nifty Outlook
Bank Nifty Technical Outlook
Bank Nifty began the week with a downward hole and promoting strain for many a part of the week led it to shut on a adverse notice. Bank Nifty closed at 33121 with a lack of 1470 factors on a weekly foundation.
On the weekly chart the index has fashioned a protracted bearish candle forming decrease High-Low in comparison with earlier week and has closed under its low indicating weak spot at present ranges . The chart sample means that if Nifty Bank crosses and sustains above 34000 degree it will witness shopping for which might lead the index in direction of 34800-35500 ranges. However, if the index breaks under 33000 degree it will witness promoting which might take the index in direction of 32000-31500. Bank Nifty is buying and selling under 20, 50, 100 and 200 day SMA that are necessary brief time period shifting averages, indicating adverse bias within the brief to medium time period. For the week, we count on Bank Nifty to commerce within the vary of 34500-32500 with a adverse bias.
Bank Nifty Derivative Outlook
Bank Nifty Put choices OI distribution exhibits that 33500 has highest OI focus adopted by 33000 & 32500 which can act as help for present expiry. Bank Nifty Call strike 33500 adopted by 34000 witnessed important OI focus and should act as resistance for present expiry.
NSE Nifty 50 index buying and selling technique
India VIX closed at 23.49% up by 11% on weekly foundation indicating markets are prone to make a powerful transfer in both of the instructions with elevated Implied volatility, and to reap the benefits of the identical we’re suggesting a market-neutral technique known as Long Straddle for weekly expiry at nineteenth May 2022.This technique entails shopping for of (ATM) CALL & PUT one lot every of 15,800 strike having premium of 172 & 182 respectively garnering in whole premium outflow of Rs 17,700 (354 factors). As it’s a debit unfold, from revenue perspective this technique can generate theoretically limitless revenue whereas the loss is restricted to whole premium paid if Nifty closes precisely on the Long/Short strikes i.e 15,800 on expiry; nonetheless as soon as Nifty breaches the higher breakeven degree of 16,154 or the decrease breakeven degree of 15,446 and sustains on both aspect then the revenue may be limitless. It’s advisable to take care of a mix premium (i.e add premium of name + put collectively) cease lack of 150-160 factors in order that if Nifty doesn’t make a powerful transfer then losses may be curtailed by following the above talked about cease loss or else Traders as per there danger urge for food may even maintain until expiry. The technique will generate important earnings as soon as Nifty breaches the vary of 16,154 on upside or 15,446 on decrease aspect on the expiry and in addition closes above or under the break even factors.
(Rajesh Palviya, VP – Research (Head Technical & Derivatives), Axis Securities. Views expressed are the writer’s personal.)
Source: www.financialexpress.com”