Tuesday may have been “Boxing Day” but there was no such boxing seen on Dalal Street between the bulls and the bears (not that the day has any reference to the sport either) as the Nifty slowly but steadily continued to inch higher. The index has now gained 300 points in the last three sessions reversing all the losses it made during last Wednesday’s drop.
With Tuesday’s move, the index is now within 150 points from its previous intraday high of 21,593, which it hit on December 20. Wednesday will also be the final weekly and monthly options expiry for the Nifty Bank index.
In what may be signs of things to come, institutional participation was minimal on Tuesday with Foreign investors remaining net sellers while domestic institutions bought in negligible amounts.
Rajesh Bhosale of Angel One believes that there is no prominent weakness on the charts and any intermittent declines on the Nifty can be used as buying opportunities. He advises traders to remain stock-specific with immediate support for the Nifty between 21,330 – 21,300.
Till the Nifty remains above 21,350, it has the potential to test levels of 21,550 on the upside or even levels of 21,620, which will be a record high, said Shrikant Chouhan of Kotak Securities. The uptrend may be vulnerable below levels of 21,350, below which the index can fall towards levels of 21,270.
The Nifty is likely to face an immediate hurdle at 21,500 and a decisive breakout above this level could potentially propel the index into a substantial rally, according to LKP Securities’ Rupak De. Until then, the index may remain in the range of 21,300 – 21,500, he added.
An underperformer during Friday’s session, the Nifty Bank moved in tandem with the Nifty and traded in a 400-point range. Unlike the last eight trading sessions, the index did not attempt a record high but ended around 100 points lower from the day’s high of 47,838.
For the December series, the index has gained around 2,200 points or 7% making it one of the best series the index has had in a year it has otherwise underperformed.
LKP’s De said that the sentiment for the Nifty Bank has turned positive again as it closed above the 47,500 mark. “A small green bodied candle within the previous red candle indicates a potential bullish trend ahead,” he said. Resistance on the upside though, remains at 48,000 – 48,250 levels.
Put writers aggressively built positions at the 47,500 strike, which will now act as a support for the index, said Ashwin Ramani of SAMCO Securities. He said that a strong close above levels of 48,000 is needed for the Nifty Bank to see further momentum.
What Are The F&O Cues Indicating?
Nifty 50’s December futures added 4.2% in Open Interest on Tuesday. Their current rollovers stand at 52%. They are trading at a premium of 30.95 points from 52.95 points earlier. On the other hand, Nifty Bank’s December futures added 2.5% in Open Interest on Tuesday. They currently have a rollover of 51% going into their expiry session. Nifty 50’s Put-Call Ratio is at 1.23 from 1.18 earlier.
RBL Bank has entered the F&O ban list from Wednesday’s session along with NALCO, Balrampur Chini, Delta Corp and Hindustan Copper.
Ashok Leyland, India Cements and SAIL are out of the F&O ban.
Nifty 50 on the Call side for December 28 expiry:
For Thursday’s expiry, the Nifty 50 strikes between 21,450 and 21,600 have seen addition in Open Interest, with the former seeing the maximum addition.
Strike | OI Change | Premium |
21,450 | 25.19 Lakh Added | 102.85 |
21,600 | 20.83 Lakh Added | 35.9 |
21,500 | 18.21 Lakh Added | 74.7 |
Nifty 50 on the Put side for December 28 expiry:
On the Put side, the Nifty 50 strikes between 21,300 and 21,500 have seen addition in Open Interest for this Thursday’s expiry.
Strike | OI Change | Premium |
21,300 | 43.49 Lakh Added | 36.05 |
21,400 | 40.92 Lakh Added | 61.1 |
21,450 | 27.87 Lakh Added | 79.1 |
21,500 | 27.71 Lakh Added | 101.4 |
These stocks saw short covering on Tuesday, meaning an increase in price but decline in Open Interest:
Stock | Price Change | OI Change |
NMDC | 3.79% | -40.31% |
Tech Mahindra | 0.25% | -40.21% |
MRF | 0.68% | -39.64% |
Tata Chemicals | 7.21% | -39.35% |
Aarti Industries | 6.18% | -39.34% |
These stocks saw unwinding of long positions on Tuesday, meaning a decline in both price and Open Interest:
Stock | Price Change | OI Change |
Manappuram Finance | -2.89% | -62.85% |
Aurobindo Pharma | -0.32% | -58.70% |
HDFC AMC | -1.06% | -56.41% |
SBI Card | -0.59% | -50.23% |
RBL Bank | -4.11% | -50.19% |
These are the stocks to watch out for ahead of Wednesday’s trading session:
First Published: Dec 26, 2023 8:43 PM IST
Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.