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Nifty

Nifty witnessed an ‘Engulfing Bullish’ formation on its daily scale as it managed to cover up from its 2 days of losing streak. Theindexhasmanaged to sustain above its multiple averages confluence support zone around 16520 to 16480. Lately its trend strengthindicatorRSIsaw a rebound from its 70 level to register a negative crossover but on the other hand its other trend strength indicator ADXsawasustained breakout above its 25 zone holding well, which is a sign of strength. Hence its ideal to remain optimistic until 16430holdswhile upside may resume only above 16740 zone. Until then expect the ranged action to continue within 16500-16700.Derivativedatacompliments the expected range of 17000 to 16500 with 16700 to remain a key intraday resistance to gauge trend strength. Unwindingpressure on either of the strikes 16500 or 16700 would lead to an either side expiry moves. As of yesterday, option painfor Niftystoodat 16600 while for Nifty Bank it is placed at 36600. We expect a Nifty Bank to witness a dramatic shift on the higher side towards37000-37300 zone while for Nifty could see a move towards 16800 to 16850 once unwinding pressure at 16700 gets triggered. Theentirepositive equation stands valid until 16430 holds while the key intraday support is placed at 16560.

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