Nifty needs to hold 17450 for a move towards 17650-17777; watch ZEE, DLF, ICICI Bank stocks for action

By Shivangi Sarda

The Nifty 50 index opened gap-up and moved above 17500 zones on Wednesday. It surpassed its previous hurdle and sustained well at higher zones. It closed near its day’s high with gains of around 170 points and gave the highest daily close of the last 32 sessions. While doing so, it formed a small-bodied Bullish candle on the daily scale with a long lower shadow indicating continued support based buying seen at lower levels. It came out of its restricted range of the last eight sessions.

India VIX was down by 3.24% from 21.30 to 20.61 levels. Cool off in volatility has supported the bulls and it needs to now sustain at lower zones for market stability. On the Options front Maximum Call OI is at 18000 then 17500 strike while Maximum Put OI is at 17000 then 16500 strike. Minor Call writing is seen at 17600 then 17550 strike while Put writing is seen at 17400 then 17500 strike. Options data suggests an immediate trading range in between 17250 to 17700 zones.

Bank Nifty opened gap up and ascended above 36400 levels. Selective heavyweight private banks drove the movement in the index and it closed with gains of around 490 points. It formed a small-bodied Bullish candle on daily scale near its 50 EMA levels.

For weekly Bank Nifty, Maximum Put OI is at 36000 then 35000 strike and maximum Call OI is placed at 37000 then 36500 strike. We have seen Call writing in 36400 with significant unwinding in 36000 while Put writing is witnessed at 36000 strike. Now it has to hold above 36250 zones, for an up move towards 36600 and 36750 zones whereas support can be seen at 36000 and 35750 zones.

On the sectoral front, apart from Metal and Pharma all other sectors traded in the positive territory on Wednesday out of which Media, Financial Services, Realty and Banking showed the most strength.

Now Nifty has to hold above 17450 zones, for an up move towards 17650 and 17777 zones whereas support exists at 17350 and 17222 zones. Nifty and Bank Nifty are holding at higher levels. Traders are advised to apply buy on decline strategy and be with stock specific action in Mindtree, Adani Enterprises, ZEEL, Bajaj Finserv, SRF, IRCTC, Tata consumer Products, Powergrid, Bajaj Finance, Grasim, Cholafin, DLF, LTTS, Axis Bank and ICICI Bank.

(Shivangi Sarda is an Analyst – Equity Derivatives & Technicals, Broking & Distribution, Motilal Oswal Financial Services Ltd. Views expressed are the author’s own. Please consult your financial advisor before investing.)

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