The Nifty50 ended the record week with gains of around 2 percent but it looks like bulls are not going to give up that easy as fresh Put writing at strike prices 9,100-9,300 adds to bullish sentiment.
Fresh Pit writing was seen at strike prices 9000 (0.7 lakh contracts added) which will now act as crucial support for the index, followed by 9,100 which saw fresh additions of 7.07 lakh contracts, 9,200 recorded additions of 4.9 lakh contracts, and 9,300 saw additions of 5.5 lakh contracts.
On the technical front, a couple of key moving averages (i.e. ‘5-EMA’ on the weekly chart as well as ‘200-EMA’ on hourly chart) provided rock-solid support for our market as a result, the Nifty rebounded smartly from this support zone to reach yet another milestone of 9,300.
The RSI oscillator too moved higher on our expected lines, which clearly provided the impetus this Positive Reversal and then a smart towards record highs, suggest experts.
Technically speaking, the Nifty has closed above its strong resistance of 127% reciprocal retracement level of the previous fall from 8968.70 to 7893.80 on the weekly chart.
On the flipside, the penultimate week’s resistance of 9,160 – 9,200 will now act as a strong support for the index. The corrections that we saw on Thursday and Friday of last week were not that fierce and in case the market does give you an opportunity in short term then buy quality stocks on dips.
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