The Nifty consolidated above 18,300 and closed 21 points lower at 18,329 on November 14, forming a bearish candle on the daily charts as the closing was lower than the opening level.
The index moved closer to 18,400, which can play an important role in the coming session as a decisive close above the level can take the Nifty towards the record high of 18,604, with immediate support at 18,300-18,200 followed by 18,000, experts said.
“The hourly chart shows that a rising trendline drawn from the previous key swing highs acted as a resistance near 18,400. On the downside, the zone of 18,300-18,200 is now acting as a support as per the principle of role reversal,” Gaurav Ratnaparkhi, Head of Technical Research at Sharekhan by BNP Paribas said.
The Nifty has to stay above 18,300-18,200 to keep the upside trajectory intact. A breach will drag the index again to 18,000, the market expert said.
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On the Options front, the maximum Call open interest remained at 19,000 strike followed by 19,500 strike, which both are deep out-of-money Calls (which generally trade much higher than current levels and are much riskier bets than strike prices near current levels), with Call writing at 18,400 strike then 19,000 strike.
On the Put side, the maximum open interest was at 18,000 strike, which can act as a crucial support, followed by 17,000 strike and 18,300 strike, with Put writing at 18,400 strike then 18,000 strike.
The data indicates that the Nifty can trade in the 18,000-18,700 range in the coming sessions.
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The broader market outperformed the frontliner, with the Nifty midcap 100 index rising 0.06 percent and the smallcap 100 index gaining half a percent.
India VIX, which indicated the expected volatility over the next 30 days, rose 3.5 percent to 14.91 levels.
Banking index
The Bank Nifty opened higher at 42,177 and rose to 42,231 but squandered the gains. It closed 60 points lower at 42,077, forming a bearish candle on the daily charts.
The level of 42,000 will be crucial on either side.
“The lower-end support is visible at 41,500 which will act as a line of defence for the bulls, whereas the higher-end resistance is at 42,500. A break on either side will clear the trend for the index, however, the undertone remains bullish and one should keep a buy-on-dip approach,” Kunal Shah, Senior Technical Analyst at LKP Securities said.
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