HomeMarketsNifty in tight consolidation zone. What investors should do on Thursday expiry

Nifty in tight consolidation zone. What investors should do on Thursday expiry

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Trembling ahead of the outcome of the crucial US Federal Reserve meeting tonight and expiry day tomorrow, Sensex ended over 260 points lower. Volumes were on the lower side as traders tried to adopt a wait and watch approach before Powell makes key announcements later tonight. On the daily chart, a small negative candle was formed with minor upper and lower shadows, which indicates consolidation.

According to chart readers, Nifty has to hold near 17,667 zones for an up move towards 17,850 and 18,000 zone, whereas support exists at 17,550 and 17,442 zones.

Here’s what analysts say:

Devarsh Vakil, Deputy Head of Retail Research, Securities
Short-term support for Nifty is seen at 17,500-odd levels, which happens to be the 34-day EMA. Resistance for Nifty is seen at 18,100 odd levels. For the last 6 weeks, Nifty has been in a tight consolidation zone. Breakout from the 17,500-18,100 range would give directional movement in Nifty.

Ajit Mishra, VP – Research, Broking
Markets will first react to the Fed meeting outcome in early trades on Thursday. Besides, the scheduled weekly expiry would add to the volatility. Amid all, indications are in favour of further consolidation. On the index front, the 17,400-17,500 zone would act as a cushion in Nifty, while a rebound towards the 17,900-18,000 zone may attract selling pressure.

Chandan ,
On Options front, Maximum Call OI is at 18,000-18,500 strike, while Maximum Put OI is at 17,500-17,000 strike. Call writing is seen at 17,800-18,000 strike, while Put writing is at 17,800-17,600 strike. Option data suggests a broader trading range between 17,200 to 18,200 zones, while an immediate range in between 17,500 to 18,000 zones.

Sahaj Agrawal, Head of Research- Derivatives at Kotak Securities
Monthly support is only seen at 17,000. US Fed comments are expected to keep volatility high in the near term. Expect consolidation to correct in the near term as the broader market sentiment has also turned negative.

FII positions suggest a reduction in net shorts, which may limit the downside in the near term. For Nifty, maximum OI buildup is seen at 17,000 Put and 18,000 Call Option. For Nifty Bank, maximum OI buildup is seen at 40,500-41,000 put and 41500/42000 call options. For the expiry day, expect Nifty to

trade with the resistance of 17,950 – any move above the same can invite short covering.

Nagaraj Shetti, Technical Research Analyst, HDFC Securities
The short-term trend of Nifty continues to be choppy. The market is stuck within a broader high low range of 18100-17500 levels, and the movement within the said range is expected for the next few sessions. Any decisive move beyond this range could bring acceleration in the momentum on either side.

Om Mehra, Technical Associate, Choice Broking
As it closed below 17750, an important Fibonacci level, the overall structure shows that the index is likely to witness consolidation or profit booking from higher levels. Overall, the market breadth remains bullish until we close below 17430 levels. RSI and MACD are indicating neutral views as of now.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)



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