F&O: Nifty charts show buying on dips; may bounce from 15,700 level

Nifty on Friday opened positive and after a slight dip in the initial hour, it moved upward but remained in a consolidation zone. It closed near the intraday high levels with a gain of around 40 points. It continued to form lower lows for the last four sessions but formed a Bullish Hammer sort of candle on the daily scale, which indicated that declines are being bought into. Now, it has to hold above 15,700 level to witness a bounce towards 15,850 and 15,900 levels while on the downside support can be seen at 15,600 and 15,500 levels.

India VIX fell 5.84% from 12.84 to 12.09 level. The fear gauge gradually drifted lower and hovered near its lowest level in last 17 months. Lower volatility indicates a rangebound move but at the same time decline could be bought into.

On the options front, maximum Put Open Interest was seen at 15,500 level followed by 15,000 while maximum Call OI was seen at 16,000 followed by 16,500 levels. Call writing was seen at 16,100 level and then 16,200 while there was Put writing at 15,000 and then 15,500 levels. Options data suggests an immediate trading range between 15,600 and 15,900 levels.

Bank Nifty opened positive and moved in a zigzag fashion throughout the day. Banking stocks moved in a lacklustre way as the index lacked momentum. It formed a small-bodied bullish candle on the daily scale and continued to form lower highs and lows since the last four sessions. Now it has to hold above 34,750 level to move up towards 35,000 and 35,250 levels, while on the downside, support exists at 34,500 and 34,250 levels.

Nifty futures closed positive with a gain of 0.23% at 15,747 level. Among specific stocks, the trade setup looked bullish in Tatachem, Manappuram, SRF, Auropharma, Divislabs, Apollo Hospital,

, Balkrishnaind, Lalpathlabs, Deepakntr Torntpower, ICICIPru, Tataconsum and Pidilitind but weak in Adanient, Tatasteel, Jswsteel, Powergrid, Britania, PFC and LT.

(Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)

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