Benchmark indices posted a dramatic recovery in the last hour of the trading session on Monday, with investors lapping up bank, technology and oil and gas stocks.
Bulls maintained their upper hand for another trading session on Monday by holding on to stocks and preventing bears from getting an upper hand. Technically, the trend will change in favour of the bears only if the Sensex slips below 14,000 and the Nifty drops below 4,190.
The Nifty maintained support at 4,330 last week and on Monday's session too, with almost a third of the trading volumes in Nifty September futures changing hands during the last hour at 4,337 points. The order book position on NSE at the end of the trading session showed that there were more buy orders than sell orders.
However, the open interest in Nifty September futures, which was up by 1.57 million shares during the intraday trade, declined by 251,850 shares during the half-hour trade-off session after the trading hours.
Besides, Nifty September futures’ premium to the spot market declined from 12 points to two. The Nifty ruled strong on the Singapore exchange, with the SGX CNX Nifty September Index Futures trading at 4,398 on the over-the-counter market at 6.40 pm.
The momentum indicators are also supporting the market on the upside, with a target of 4,600 and a stop-loss at 4,200. The short-term resistance is seen at 4,440 and the intraday resistance for the Nifty is 4,380. Calls were bought and puts were written at the 4,400 strike price, indicating that both buyers and sellers expects index to trade above the 4,400 level.
