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F&O: Nifty50 must hold above 10,480 to extend gains towards 10,630

Nifty50 finally negated its higher highs formation after 14 consecutive trading sessions.

ET CONTRIBUTORS|
Apr 19, 2018, 05.17 PM IST
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Nifty50 finally negated its higher highs formation after 14 consecutive trading sessions.
By Chandan Taparia

The Nifty index opened positive and remained in a narrow range for the entire session on Thursday. It formed an 'Inside Bar' on daily scale, which generally implies sideways momentum in the market.

The index finally negated its higher highs formation after 14 consecutive trading sessions. Now, till Nifty holds above 10,480 zones, it could extend gains towards 10,630, while on the downside, supports are seen 10,480 levels.

On the option front, maximum Put open interest is at 10,500 followed by 10,400, which is shifting its support to higher zones, while maximum Call open interest is at 10,700 followed by 10,600 strikes.

We have seen Put writing at 10,500 and 10,600 strike, while call writing was seen at 10,600 strike, which could restrict its upside move. Option band suggests an immediate trading range between 10,450 and 10,650 zones.

India VIX fell down by 2.55 per cent to 13.75.

Nifty Bank opened positive, but failed to cross above its crucial resistance of 25,250 levels. It formed a bearish candle on a daily chart, which implies that sustained selling pressure is seen at higher levels. Now, it has to cross and hold above 25,250 zones to extend its move towards 25,500, and then 25,750 levels, while a hold below 25,000 could attract weakness towards 24,750 zones.

Bank Nifty has been consolidating in between 25,000 and 25,400 zones from last eight trading sessions, and requires a decisive range breakout to start the next leg of rally.

Nifty future closed with a gain of 0.38 per cent at 10,579. Built up of long positions were seen in Hindalco, Torrent Pharmaceuticals, M&Mfin, Mahindra & Mahindra Financial Services, Justdial, Tata Elxsi and Dabur, while shorts were seen in BPCL, Hindustan Petroleum, Axis Bank, Titan, IndusInd Bank, Bharat Financial Inclusion and IOC.

(Chandan Taparia is Technical & Derivative Analyst at Motilal Oswal Securities. Investors are advised to consult financial advisers before taking an investment calls based on these observations)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)

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