As expected, the Nifty closed in the red on profit-booking and lack of buying above 5,360. Nifty April futures saw 53 per cent volume in value areas (5,300-5,360), considerably lower than the normal level of 75-80 per cent. This triggered fresh sell-off in Nifty April futures, which closed below 5,300, with 32 per cent volume below value areas. Nifty spot and futures, however, maintained their lower-end support of 5,260, considered a trend decider.
The April futures closed at a premium to the spot but shed 2.65 million shares in open interest from intra-day levels, indicating profit-booking. The price projection using the time-price opportunity (TPO) chart indicates a sharp bounce-back around 5,530, while the support area using volume has been around 5,188.
Technically, the close of 5,273 is marginally below the 20-day moving average of 5,279, which invites a secondary correction.
The 5,300 call added significant open interest while there was unwinding in 5,200 and 5,300 puts. This means 5,200-5,300 is expected to be the trading zone in the near future. Strong support is expected below 5,300, with 5,260 likely to be the trend decider. Strong resistance is expected above 5,300. The bulls will have an upper hand only if the Nifty closes above 5,360 on the back of strong volumes. In the last few sessions, the trading volume has remained 8-10 per cent above 5,360.
Among key index stocks, Reliance Industries closed below value areas on strong sell trades. The April futures of Reliance Industries saw 30 per cent volume below Rs 1,102, mostly on account of profit-booking.
ICICI Bank closed in the red at Rs 919 and saw only 9 per cent volume below this level. April futures of ICICI Bank, which closed at a marginal discount to the spot, saw strong buy trades around value areas. The futures added 697,200 shares in open interest, indicating long build-up.
Infosys Technologies moved in a narrow range, indicating tired buyers. The TPO chart indicates that April futures of Infosys can rise to Rs 2,855.
