After four consecutive days of hesitancy, the Nifty surrendered its 6,000-level support and closed at 5,903 on selling from liquidity providers all through the day.
The Nifty managed to hold 5,900 as traders went for value buying when it slipped below the volume-based support of 5,930. The trade summery matrix for the day suggests selling in the initial balance range (5,935-5,985) established by the first two time-price opportunities (TPO) time periods and change of hands in the value area (5,905-5,950) that makes up 70 per cent price points.
Nifty December futures closed at a 20-point premium to the spot while open interest remained unchanged despite an increase in volume by 3.75 million shares.
Though Nifty futures recovered from the day’s low of 5,895 to close at 5,925, a significant 62 per cent trades below the day’s mid-point level of 5,940 suggests weak undercurrent. The market picture chart is hinting at volume-based support for Nifty futures around 5,862.50 and a TPO-based upside of 5,982.50. The spot Nifty is expected to get support at 5,840 and resistance around 5,960.
Over all, the market is expected to stay within 5,840-6,020 in the coming days unless we get fresh cues. The trading pattern in Nifty call options is hinting at a strong resistance above 6,000 and break of support at 5,900. The 6,000-strike call options added 1.46 million shares in open interest while the 5,900 call added 625,900 shares in open interest through sell trades. Put options data show weak undercurrent with dwindling support at 5,900 and index declining below 5,800 on account of unwinding of short positions in these put options.
The weakness in the Nifty may get a fresh push from key banking sector stocks. State Bank of India, which closed at Rs 2,806, is expected to move down around Rs 2,755, the market picture chart suggests. HDFC Bank may see a fresh correction around Rs 2,227 from Rs 2,280 while Axis Bank is expected to fall around Rs 1,182 from 1,251, the volume picture chart indicates. ICICI Bank is expected to move up marginally around Rs 1,115 from Rs 1,105.
