On 17th September 2019 Nifty opened at 11,000, made a high of 11,000 low of 10795 and finally closed at 10817. Today was a one-sided day in favor of Bears, where bulls have no chance to make slightest of a comeback in the market.
Open interest wise maximum call open interest for the current month series is at 11,000 level, while maximum put open interest stands at 10800. So these levels become a logical range for the market in the short term. Though aggressive call writing was also seen at 10,900 levels, indicating a capped upside.
Nifty short term support stands at 10800 and then 10600 while resistance is at 10,900 and 11,000.
As we can see from the daily chart of Nifty. It is below the 200-day moving average and 50 day moving average. And the trend on daily is sideways to down. Nifty has broken a trendline, indicating that the market should continue its southward rally.
In the hourly chart also Nifty is showing weakness. Therefore any rise in the Index till 10860 should be used to create a short position in Nifty with a stop loss of 10,940.
Open Interest Analysis of Nifty
If we analyze the open interest data of Nifty, it supports our view of short bias.
From the graph of open interest, it is clear that 10,800 is still very crucial from the options point of view. And option sellers are getting more aggressive by selling 10,900 call ( 35% up )
Stock Trading Strategy
- ACC: Sell below 1485 with a stop loss of 1500 and target of 1450. It is on the verge of a breakdown.
- Divis Lab: Sell at 1615 with a stop loss of 1630 and target of 1570.
- IRB: Sell below 78.5 with a stop loss of 82 and target of 74
- JSW Steel: Sell at 220 with a stop loss of 224 and a target of 212
- RBL Bank: Sell at 356-358 with a stop loss of 364 and a target of 330
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