Is the tide turning in Nifty?

NSE:NIFTY   Nifty 50 Index
Is Nifty in consolidation mode. But how can it be? It fell almost 144 points (0.95%) on Friday, so have our markets not entered correction phase? Let’s see some data. Nifty’s life time high 15,431.75 was reached on 16th Feb and on Friday, 12th March (after almost a month). Nifty touched 15,336 during first 5 minutes and then after half an hour or so couldn’t go past 15300 during the entire day and started falling after 12 pm continuously till it reached intraday low of 14953, bounced back and closed at 15030.95 - meaning closed above 15000. What does it mean? To me, It says that Nifty’s range as of now is 14950 to 15300. Let us confirm this using option chain.
On PUT side highest total OI (28,046 lots) and highest Put writing (13,676) is at 15000 strike meaning as of now, 15000 looks OK support. On CALL side, highest total OI (53,615 lots) and highest Call writing (44,765) is at 15300 which means 15300 looks like solid resistance. One more minor observation, look at volume of Call OI and Call writing-it is significantly higher than on Put side, which tells us that markets are on bearish note. But then, FIIs were buying so how come markets are showing bearish signs? So let us examine FII and DII buy/sell figures.
On Friday, FIIs were net sellers in Equity Cash segment by 164 Crs and DIIs were net sellers by 942 Crs. FIIs (net) sold index futures by 586 Crs and stock futures by 1,357 Crs. Maning FIIs sold well on last Friday. Going further, out of last 6 trading sessions, in Cash segment, FIIs were net sellers in 5 sessions. In only one session they bought stocks worth 2,802 Crs whereas DIIs, during the same period, were net buyers in 3 sessions and net sellers in 3 sessions. This implies that days of blanket buying by FIIs are over and similarly days of blanket selling by DIIs are also over. Now stock and sector specific buying and selling will happen which again means that markets are in consolidation phase.
On Charts, Nifty fell from its intraday high, which it reached after more than 15 sessions, to close as a big bearish red candle taking support at mid-line of Bollinger band (20 day SMA) and 20 DEMA and closed above psychological support of 15000. So if world markets are supportive, Nifty might open gap up and climb up. On Friday night, US markets gave mixed signal- DOW (DJIA) was up by 0.90% but NASDAQ closed 0.59% down and S&P500 closed marginally 0.10% up- so it is not alarming scenario. SGX nifty at night closed at 15090 up by 61 points which indicates positive bias w.r.t. our Nifty. In a nutshell, Nifty looks bullish so buy at around 14,950 and sell within the selling Area demarcated on chart (15,200 -15,235) with SL above 15,240. There is a clear-cut resistance at 15,300 so Sell here and put SL above 15330.
Happy trading, stay safe, stay healthy.

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