Market Trade Setup
The stock market has been witnessing bullish momentum with benchmark indices reaching record highs due to strong buying across key sectors. On September 26, during the monthly Futures and Options (F&O) expiry, the Nifty 50 achieved a remarkable milestone, crossing the 26,250 mark with a gain of 212 points. This marks the seventh consecutive session where Nifty maintained higher highs, accompanied by a drop in volatility to a two-month low. Looking ahead, the next targets for the index are projected at 26,300 and subsequently 26,500, contingent upon maintaining steady support around the 26,000 level. However, market analysts caution that some degree of consolidation may occur before further upward movement.
Key Support and Resistance Levels for Nifty
| Support Levels | Resistance Levels |
|---|---|
| 26,059 | 26,252 |
| 25,999 | 26,311 |
| 25,903 | 26,408 |
Bank Nifty Key Levels
| Support Levels | Resistance Levels |
|---|---|
| 54,110 | 54,459 |
| 54,002 | 54,567 |
| 53,828 | 54,741 |
Fibonacci Retractions for Bank Nifty
| Support Levels | Resistance Levels |
|---|---|
| 53,327 | 54,898 |
| 52,631 | 55,653 |
Nifty Call and Put Option Data
On a monthly basis, the Nifty saw the highest call open interest of 96.95 lakh contracts at the 26,500 strike, establishing it as a crucial resistance level in upcoming trading sessions. Conversely, the maximum put open interest of 1.7 crore contracts was recorded at the 26,200 strike, marking it as an important support level.
Bank Nifty Options Data
The Bank Nifty displayed significant call open interest of 16.73 lakh contracts at the 54,000 strike, which will serve as a vital resistance level. Additionally, the maximum put open interest stood at 22.44 lakh contracts at the same strike, indicating a dual significance for traders.
Market Volatility and Investor Sentiment
Yesterdays’ trading session witnessed a notable decline in volatility for the third consecutive day, reaching its lowest point in two months. The India VIX fell by 5.81% to close at 12, indicating favorable conditions for bullish traders. As long as the volatility index remains below 14 points, there is optimism among bulls for continued upward momentum.
Delivery Trades and Investor Interest
The session showcased stocks with notable delivery trade volumes, signifying significant investor interest. A higher delivery share often reflects trader confidence in the stock’s future performance.
Open Interest Analysis
- Long Build-up: 14 stocks indicated an increase in open interest alongside price hikes, suggesting growing bullish sentiments.
- Long Unwinding: 46 stocks experienced a decline in both open interest and prices, signaling profit booking among investors.
- Short Build-up: In contrast, 5 stocks displayed increased open interest coupled with price drops, reflecting bearish positioning.
- Short Covering: 119 stocks saw short covering, indicated by a decrease in open interest and rising prices.
Put-Call Ratio (PCR) Insights
The Nifty put-call ratio rose to 1.37 as of September 26, which is an indication of bullish sentiment in the market. Generally, a PCR above 0.7 or crossing 1 signifies a bullish outlook, whereas a decline below 0.7 points toward a bearish sentiment.
F&O Ban Overview
No new stocks have been added to the F&O ban list, and there are currently no restrictions on any securities within this segment. This lack of restrictions can encourage trading activity.
