Selling pressure intensifies in past half hour; India VIX jumps over 4 per cent & 15,800 Call option adds 43.98 lakh shares in OI
Market Update at 1:23 PM:Selling pressure in the Indian markets has intensified in the last half an hour. As a result, the key benchmark indices were trading near the day’s low. India VIX jumped more than 4 per cent and it is back above the 15-mark.
Talking about the sectoral performance, barring Nifty Auto, Nifty PSU Bank and Nifty Realty, all other indices were trading in red. Nifty IT has been the top loser as it lost nearly 0.88 per cent.
The level of 15,800 is going to be a strong barrier for the bulls to cross in the near term as 15,800 Call option has seen a massive addition in the open interest. Besides, nearly 44 lakh shares have been added in the open interest in 15,800 Call option strike.
Market update at 10:05 AM: The key benchmark indices yet again witnessed profit booking at higher levels on Wednesday. Indian markets began the session on a buoyant note; however, profit booking was seen from the word go. As a result, Nifty slipped nearly 80 points from the day’s high and was seen hovering around the neutral line.
Among sectoral indices, the majority of the sectors were trading in the green, led by Nifty Auto and Nifty Metal. The broader markets were also seen trading in green but with modest gains.
On the options' front, 15,800 Call option has seen an aggressive addition of open interest in the first hour of the trade today. Nearly 17 lakh shares have been added in the open interest in the 15,800 Call option. With this, the total concentration of open interest in the 15,800 Call strike has surpassed the 68 lakh mark while the highest concentration of open interest on the call side was seen in the 16,000 Call option.
Indian markets on Tuesday witnessed exactly opposite to what it saw in the prior two trading sessions. On the second trading session of the week, Nifty opened with a gap-up and extended its gains with Sensex hitting a new lifetime high and Nifty almost revisiting its previous all-time highs. However, in the latter half of the trading session, there was a change in fortune as the market trimmed the bulk of its gains and settled near the day’s low.
Among the sectoral indices, Nifty Auto surged 1.34 per cent while Nifty IT advanced 0.55 per cent. On the other hand, Nifty Realty, Nifty Bank, and Nifty Private Bank ended down in the range of 0.35 per cent to 0.68 per cent. Interestingly, India VIX cooled off by 2.14 per cent and slipped below the 15-mark.
Technically, after opening with a gap-up, Nifty filled the opening upside gap by the end of the day itself. It almost tested the previous high, which was just 6 points away. During the day, it broke the channel resistance in the first hour. However, later, it made lower highs & lower lows throughout the day and closed near its day's low.
Though Nifty closed in the positive territory, yet the follow-through day is not convincing enough to signal the continuation of upmove. Nifty took support at immediate short-term moving average i.e. 5-EMA. Furthermore, the ATR continued to surge and as we are nearing June derivative series expiry day, it is expected to move further up. Also, as the volatility remains near its lower level in recent times, there are high chances that we could see it surging on the upside.
The level of 15,900-15,905 is a visible resistance in the near term and as long as Nifty does not close above this zone, there is a high possibility that the index may consolidate. On the downside, the level of 15,600 is an immediate support, followed by 15,500 level.