As expected, the Nifty and March futures gained five per cent in the past four trading sessions after the market formed a non trend day on March 24. We had indicated that the non trend day formation occurs rarely and is often a precursor to a new vertical move. Today, the market moved in a narrow band and involved day traders than the other time frame traders.
The initial balance range (5,780-5,805) saw 80 per cent volume and 75 per cent time-price opportunity (TPO) counts from floor traders. The three consecutive days volume-based up move and the short covering in the initial balance range is expected to take the Nifty futures at around 5,927, the TPO price projection indicates.
The market undercurrent remained positive as the Nifty closed above value area (5,787-5,805). The TPO counts below the point of control (PoC) were higher than the upper portion of PoC (5,830-5,835) which indicate net buying day. The trade summary matrix (TSM) data suggest short covering in value area and also the IB range. The short positions got covered when the Nifty March futures started convincingly above 5,780. The Nifty futures also closed above the value area and saw more price action. Overall, the TPOs data suggests buy-side bias in the Nifty April futures and change of hands in the March futures. The participants covered short positions in the value area.
The TPO count above the point of control (PoC), the area of most traded price, hints at fresh rally as the number of TPO at upper portion of the PoC were lower than the lower portion of PoC. The price projection using TPOs and volume picture chart suggest target of 5,830 and support at 5,752. The rollover in the Nifty April futures were at a 40-point premium and significantly higher at 19.44 million shares compared to 14.44 million shares were rolled over in the March futures a day before expiry of February series.
Options traders covered short positions in the 5,700-5,800-strike call options and built fresh short positions in the 5,800-strike put options. The OI build-up at 5,700-5,800-strike put options in the past couple of trading sessions indicates the Nifty expiry will be around 5,800.