Nifty50 failed to hold on to the record high amid profit booking and ended in the red with Nifty PSU Bank, pharma and metal indices gaining 1-2 percent each.
It formed a bearish candle and a bearish belt hold sort of candle which indicates that follow up is required to commence the next leg of rally.
Nifty may be chalking out a minor trading zone with a range of around 200 points in the zone of 15,900 – 15,673 levels and hence correction should get accentuated on a close below 15,670 levels with targets towards 15,500, said Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory at Chartviewindia.in.
For the time being, traders are advised to remain neutral but can consider stock-specific opportunities on long side as advance decline ratio remained positive for the session, he added.
Nifty50 touched fresh record levels of 15,915.65, in the morning but gave up the gains later in the day.
India VIX moved up marginally by 0.24% from 13.36 to 13.40 levels.
Option data suggests a wider trading range in between 15500 to 16200 zones while an immediate range in between 15600 to 16000 zones.
On option front, Maximum Put OI is at 15500 followed by 15000 strike while maximum Call OI is at 16000 followed by 16500 strike. Call writing is seen at 16400 and 16500 strike while Put writing is seen at 15200 then 15600 strike.
Bank Nifty opened positive but failed to hold above 35550 zones and remained consolidative in range of 35250 to 35550 zones. It was unable to continue its momentum of the last session and closed the day on the flattish note.
"Now it has to hold above 35250 zones to move up towards 35750 and 36000 zones while on the downside support exists at 35000 and 34750 levels," said Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services.On stocks front, bullish setup was seen in NALCO, Bank of Baroda, IGL, UBL, Cadila, Glenmark, PNB, Dr Reddy, Escorts, Biocon, Divis Labs, Tech Mahindra, Cummins India, Tata Steel, Tata Consumer, SRF, Cipla and Eicher Motor while weakness in Titan, Cholamandalam Financial, Motherson Sumi, HDFC, Reliance, ITC and BPCL.