The uptrend in the markets remained intact for five consecutive
sessions despite a build-up of fresh shorts in frontline technology
stocks on account of the poor fourth quarter results from TCS.
Going forward, markets are likely to be range-bound with strong
support for the Nifty seen at 5,000 and resistance at 5,100.
Besides, the average daily turnover in the last few trading days
before expiry has fallen considerably from Rs 63,000 crore (March
expiry) to Rs 43,000 crore in the current month, indicating an absence
of short positions.
The rollover in May futures contracts at 18.80 million shares are at a
higher side compared with the rollover of 15.24 million shares in
April futures contracts two days before the expiry of March futures
contracts.
The Nifty PCR was marginally up from 1.31 to 1.36 as the open interest
(OI) in put options has increased by 14.37 lakh shares, while the call
options OI increased by 3.47 lakh shares.
The put OI increased by 6.37 lakh shares at the 5,000 strike price,
indicating support, while the call OI increased by 2.71 lakh shares at
the 5,100 strike price, indicating resistance.
Technically, the five days' relative strength index (RSI), which is at
85 now, indicates overbought positions in the markets.
However, the 14-day RSI is comfortably low at 60, indicating that
there is enough scope for the markets to go up. The technical
resistance for the Nifty tomorrow is at 5,084 and the support is at
5,004.
Source : Business Standard
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