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Technical View | Nifty forms bullish candle, consolidation continues ahead of June F&O expiry

Traders should remain neutral in the next session, as the market is expected to be volatile on the monthly expiry of futures and options contracts, Mazhar Mohammad of Chartviewindia has said

June 29, 2022 / 05:33 PM IST

The Nifty once again succumbed to selling pressure in late trade and closed 0.21 percent lower at 15,799 on June 29, a day ahead of the monthly expiry of June futures & options contracts.

The index formed a bullish candlestick on the daily chart as the closing was higher than the opening levels. Overall, it has moved in the 15,700-15,900 range since the start of the week. The range has to be broken decisively on either side for a direction, experts said.

"Albeit Nifty50 appears to be consolidating between 15,900 and 15,700 levels, it generated a sell signal on our twin momentum oscillators post- Wednesday's price action," Mazhar Mohammad, Founder & Chief Market Strategist at Chartviewindia, said.

Apart from the supplies emanating from the bearish gap zone of 15,886 and 16,172 levels, the 20-day  simple moving average (15,912) appears to be capping the prices for the last three sessions. Unless the index closed above 15,927, strength should not be expected, he said.

If the Nifty fails to sustain above 15,687 in the next session, it will attract intraday selling with an eventual target placed at around 15,400.


Considering monthly expiry in the next session, markets may witness volatile and choppy moves. Traders should remain neutral in the next session, Mohammad said.

A correction was also seen in broader space. The Nifty Midcap 100 and Smallcap 100 indices slipped 0.4 percent and 0.6 percent.

Volatility continues to be high. India VIX, which indicates the expected volatility, went up 2.09 percent to 21.9 levels.

On the options front, the maximum Call open interest was at 16,000 strike followed by 16,500 strike, while the maximum Put open interest was at 15,500 strike followed by 15,700 strike.

Call writing was seen at 16,100 strike followed by 16,000 strike, while Put writing was seen at 15,700 strike then 15,600 strike.

This data indicated that the Nifty could trade in the range of 15,550-16,100 in the coming sessions.

Banking index

The Bank Nifty opened 350 points lower at 33,274 and moved in a narrow range of around 200 points. It formed a Doji candle on the daily frame as it closed near its opening zones with a loss of 373 points at 33,270.

"Formation of small-bodied candles from the last couple of sessions indicates tug of war between bulls and bears to make or break 33,333 levels decisively. Now, it has to cross and hold above 33,333 to make an upmove towards 33,750 and 34,000 levels whereas supports are seen at 33,000 and 32,750 levels," Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services said.

On the stock front, a positive setup was in Bosch India, Trent, ONGC, Reliance Industries, Coal India, Petronet LNG, Cummins India, TVS Motor, Indian Hotels, ACC, Ashok Leyland, Adani Enterprises, Bharti Airtel, Eicher Motor, ITC, Hindalco and City Union Bank, Taparia said.

Weakness was seen in RBL Bank, Escorts, AU Small Finance Bank, HDFC Life, Indian Energy Exchange, Bandhan Bank, Axis Bank, Muthoot Finance, Marico and Titan, he added.

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Sunil Shankar Matkar
first published: Jun 29, 2022 05:33 pm
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