Market News
4 min read | Updated on February 23, 2024, 07:58 IST
SUMMARY
The NIFTY50 invalidated Wednesday's bearish engulfing pattern. The index again showed resilience between the 21,800 and 21,900 zones, coinciding with its 20-day moving average. Experts believe, if the NIFTY50 closes above Wednesday's high (22,249), the index could extend its gains amid a rebound in IT stocks.
GIFT NIFTY is trading positive today , indicating a flat to positive start for the Indian markets.
Buoyed by gains on Wall Street, the GIFT NIFTY is trading 40 points higher, pointing to a positive start for the Indian markets today. However, Asian markets remain mixed. Japan's Nikkei is closed for a holiday, Hong Kong's Hang Seng Index is down 0.2%, while South Korea's Kospi is up 0.6%.
US stocks hit record highs on Thursday after chipmaker Nvidia reported better-than-expected quarterly results. The Dow Jones jumped 1.1% to 39,069, while the S&P 500 rose 2.1% to 5,087. The tech-heavy Nasdaq Composite rose 2.9% to 16,041.
After a flat start, the NIFTY50 dipped towards its 20-day moving average (around 21,800) in the first half of the session. However, the index found support and staged a sharp V-shaped recovery, rallying over 350 points from its intraday low to a new all-time high. The rally was led by technology stocks with TCS and Infosys gaining 2.4% and 1.5% respectively. Reliance Industries also contributed with a gain of 0.9%.
On the weekly expiry, the NIFTY50 invalidated Wednesday's bearish engulfing pattern. The index showed renewed buying momentum between 21,800 and 21,900 levels, coinciding with its 20-day moving average. Experts believe traders are expected to see a sharp spike in option premiums due to the sharp reversal and intraday volatility. In addition, if the NIFTY50 closes above Wednesday's high (22,249), the index could extend its gains amid a rebound in IT stocks.
The initial OI build of the options chain for the 29 February expiry shows a significant call base at the 23,000 and 22,000 strikes. Conversely, the put base is established at the 22,000 and 21,000 strikes. As per the initial build-up, NIFTY50 is expected to trade between 21,750-22,700 in the upcoming week.
The BANK NIFTY also had a choppy session, with a sharp reversal from the 46,500 level. The index formed a doji candle on the daily chart, indicating indecision and potential range-bound activity.
Having breached the recent swing high of 46,800, the banking index is now consolidating within a range of 47,200 on the upside and 46,300 on the downside. Experts believe the consolidation will continue until a decisive breakout above or below this range occurs on a daily closing basis.
For BANK NIFTY's 29 February expiry, the options data shows significant open interest at the 47,000 & 47,500 call option strikes and 47,000 & 46,500 put option strikes. As per the open interest, traders eye BANK NIFTY’s trading range between 44,800 and 47,500.
In Futures and Options or F&O, long build-up means an increase in Open Interest (OI) along with an increase in price, and short build-up means an increase in Open Interest(OI) along with a decrease in price.
Source: Upstox and NSE.
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