Feb 10, 2023 – Market Overview

Hello reader, hope you’re doing well. After a pretty much calm and straightforward expiry day yesterday, which has again resulted in an inside bar, Nifty is continuously lingering near its key resistance of 17900, and let’s look at the few data points which would be key for the upcoming week –

Points to note, price action wise –

• Nifty and Banknifty are both forming inside bars post the budget on Feb 1st, and are yet to break out of the current range.
• Banknifty has been comparatively stronger than Nifty in this time period, with RSI slowly inching upwards, poised for a breakout (as it can be seen in the chart below)
• In the short term, we’ve seen a retest of breakout on the PSU bank index and that can bring in some upside from current levels.
• Nifty auto would be one of the leading sectors when we see more upside from here, a breakout above 13600 will bring in more momentum.

Points to note, data wise –

• Nifty PCR currently stands at 0.86, which is within the usual range for neutral movement.
• Highest OI on calls side at 17900 and 18000 levels, with the highest on puts side being at 17800 levels
• For February’s monthly expiry, key resistance and support levels would be 18000 and 17500 with highest OI concentration at these two points.
• FII index short % still above 80%, which usually acts as reversal levels by triggering a short covering rally to begin with.
• Banknifty on the other hand has formed an important base at 41500 with the highest OI concentration at 41500 PE with more than 1.68L open contracts, followed by 41500 CE which has more than 1.09L open contracts.
• Sustaining above 42000 comfortably would be necessary to see a substantial change in OI too, which can happen in the upcoming week with a good positive trigger

Overall, it’s important for non directional traders to keep their bets hedged and play it out smoothly. Have a good trading day, and may the force be with you!

Disclaimer: this post is for educational purposes only, we are not SEBI registered analysts. Trades mentioned here are not trade recommendations. Equity Investments are subject to 100% market risk, please consult your financial advisor before investing.