Nifty 50 indexes traded negative for the entire session but recovered to a flat end. The market witnessed a slightly negative opening and continued to lose ground gradually throughout the day. The nifty index also slipped below 11,500 in afternoon trade. However, in the last one and a half hours of the session, the index has recovered over 100 points from the day’s lowest level. Nifty recovered all its losses and even crawled into positive territory for some time. The headline index finally closed with a gain of 1.35 points.
The index may have ended flat, but has formed a lower top and bottom on the daily chart. The market breadth was not that strong, with 23 out of 50 components falling. As the market enters the weekly series expiration, the move will be dominated by options-focused movements. One million shares of call open interest were added to the 15,700 strikes, and the 15,700 had a maximum call open interest of 4.8 million with total open interest. Unless there is a strategic change,
This is likely to act as a resistance for the coming trading session.
Volatility eased with the India VIX index falling 1.02 percent to 17.21. It remains at one of its lowest readings, close to the levels seen only in early 2020. It also remains a near-term concern for the market.
The 15,600 and 15,665 levels will act as resistance on Thursday. Support will come at 15,480 and 15,400 levels.
The Relative Strength Index (RSI) is at 68.90 on the daily chart. It is neutral and shows no divergence against the price. The daily MACD is bullish and above its signal line. No significant structure was observed on the candles.
Overall, a breakout does not carry logical directional bias and with volatility at a multi-month low, it would be wise not to take the current breakout lightly. It would be wise to continue to follow Upmove while continuing to take a highly stock-specific approach. Profits should be protected at a higher level. Volatility is likely to increase in the coming session. This would require a highly cautious and cautious approach towards the market.