The positive momentum continued with the Nifty50 climbing above 19,200 for the first time in last eight consecutive sessions, on November 3, backed by positive global cues and uptrend across sectors. Now, the index is at crucial point (19,200), which acted as a strong support in the month of August followed by rally in September. If the index holds the same as a support and decisively surpasses 19,300, then the move towards 19,500-19,600 can be possible, but below 19,200 on lower side can keep the market rangebound with support at 19,100-19,000 levels, experts said.
The Nifty50 again had a positive opening at 19,241 and remained higher throughout session. The index settled at 19,231, up 97 points and formed small bodied bearish candlestick pattern with upper and lower shadow which resembles Spinning Top kind of pattern on the daily charts, indicating indecisiveness among bulls and bears for firm direction.
Further, the index has seen higher low formation and seems to be on the verge of higher high formation on the daily charts. If the follow-up candle gives positive close above the Friday's high, then there can be confirmation of higher high, indicating the positive mood with strong support at 19,000.
On the weekly charts, the index has formed bullish candlestick pattern and closed 1 percent higher, but still within the previous week's range when it plunged 2.5 percent.
"After a gap up opening Nifty faced resistance around 19,250-19,300 levels and we can see maximum Put writing at 19,200 levels which may act as strong support for Nifty while we can see maximum open interest in 19,300 Call option," Kunal Shah, senior technical & derivative analyst at LKP Securities said.
Hence, one should only be bullish on Nifty if it closes above its crucial 100-day moving average placed at 19,300, he feels.
The weekly Options data indicated that the maximum Call open interest was at 19,300 strike, followed by 19,500 & 19,400 strikes, with meaningful Call writing at similar strikes, while the maximum Put open interest was at 19,200 strike, followed by 19,000 strike, with Put writing at 19,200 strike, then 19,300 strike.
Bank Nifty
The Bank Nifty also gained momentum, and maintained 43,000 mark. The index rose 301 points to 43,318 and formed Doji candlestick pattern for third consecutive session, indicating the tug-of-war between bulls & bears for clear direction.
Going ahead, 43,500 or 20-day EMA (exponential moving average) is expected to be crucial for further upmove towards 44,000, experts said.
For the week, the index rose more than 1 percent and formed bullish candlestick pattern with lower shadow on the weekly scale, but still within previous week's range.
"The bounce so far in Bank Nifty appears to be corrective in nature and it has a clear resistance in the range of 43,500-44,000 levels," Jay Thakkar, head - alternate research, capital market strategy at Sharekhan by BNP Paribas said.
On the lower side, he feels 42,849 is an immediate support and if those levels are held, then there can be a bounce back until 43,500-44,000 levels, however, if 42,849 breaks anytime from hereon then next move down will be confirmed for the targets of 42,000/41,500/41,000 levels.
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