As the benchmark equity index Nifty touched a new lifetime high on Friday, it also retreated to higher levels and managed to retain most of its gains.
The index opened on a positive note and remained within a defined and limited range for the entire session. The intraday trading range of the Nifty remained narrow; The index gained barely 60 points during the day. Though the index declined from its high point, it ended another day with a net gain of 97.80 points or 0.64 percent.
Although the market has marked an incremental high point and appears to be largely bullish, there are some conflicting points that should not be ignored. Nifty futures added 5.25 lakh shares or more than 5.33 percent to the June contract. This indicates fresh long-time excesses.
On the other hand, the options data showed the maximum call OI concentration at 15,500 and this strike continued to add call OI throughout the day. This means that this level continues to act as a resistance and can cause breakouts
In addition, the Nifty climbed 97 points last season; Reliance NSE gained around 92 points from 6.01%. This means that if it had not happened, the index would have been flat. Also, the breadth of the market has not been as strong as it should have been.
The intraday shape of the movement also showed no strong directional bias. All this indicates a high level of caution that market participants should exercise in chasing momentum. Volatility remained one of its lowest levels in recent times, with India VIX declining further at 12.59 percent to 17.4025.
Levels of 15,500 and 15,535 are likely to act as resistance points, while support will come at levels of 15,350 and 15,300.