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F&O 15 July outlook: Nifty range-bound, must top 15,900 for further rally; Bank Nifty looks up to 36,000

Financial Express - Business News, Stock Market News

Nifty, bank nifty, stock market, F&O expiryIn the past one month, Nifty 50 has continued to hover in the 15,450-15,900 zone, and is currently ruling in the middle of this range

The Nifty 50 index is likely to trade in the 15,500-15,800 range in the current week to 15 July expiry. Analysts see positive bias in the index even with no clear indication of direction. On the other hand, 34,700 remains an important level to watch out for Bank Nifty; and it may bounce back up from 35,000. In the past month, Nifty 50 has continued to hover in the 15,450-15,900 zone, and is currently ruling in the middle of this range. So far this week, Nifty has fallen over 1 per cent to today’s low of 15,632.75. It has lost nearly 2 per cent from all-time high levels. Bank Nifty has continued to underperform the broader Nifty 50 index since February this year. “We expect Bank Nifty to bounce from the current level around 35000 and move towards 35800-36000,” Ashis Biswas, Head of Technical Research, CapitalVia Global Research, told Financial Express Online.

Ajit Mishra, VP – Research, Religare Broking

Nifty has been hovering within the 15450-15,900 zone since June and currently trading in the middle of the band. With the beginning of the earnings season, a possibility of a decisive breakout seems high. Though there’s no clear indication on the direction yet, the bias is still on the positive side. We suggest participants continue with “buy on dips” till Nifty holds above the 15,450 zone. A decisive breakout above 15,900 would pave the way for 16,300+ levels.

Bank Nifty has been underperforming the Nifty index since February and there’s no sign of change in the trend yet. It has attempted to surpass the major hurdle at 36,000 zone of late but in vain. However, the downside also seems capped with multiple supports at 34,300-34,500 zone and major at 33,900 levels. We feel traders should prefer option spreads around the support zone for long positions instead of naked longs in futures citing the prevailing underperformance.

Rahul Sharma, Head, Technical and Derivatives Research, JM Financial Services

Concerns regarding the US economic recovery and Chinese inflation data are driving global markets lower. US markets were lower by around a per cent while Europe was down around 2 per cent on Thursday. Both Nifty Futures and Bank Nifty Futures saw addition of fresh shorts (OI +5.8 per cent and 5 per cent, respectively) while volumes were above average at 15-day highs. Options data is suggesting a range of 15,500-15,800. India VIX saw a spike of 11 per cent along with a one-sided slide on an expiry day. FIIs added short positions in the index while they closed their longs in stock futures. The bias remains bearish below 15,800 with downward supports at 15,635 and 15,600. Bank Nifty breakdown point is at 34,900. Follow-up selling is a must to confirm the breakdown in both indices.

Milan Vaishnav, CMT, MSTA, Consulting Technical Analyst and founder, Gemstone Equity Research & Advisory Services

The trade has started off on Friday with options data giving weak cues. The initial session has seen big Call OI addition (Call writing) at 15700 levels on Nifty with 1.7 million shares addition. With call writing at 15700, this level, followed by 15800 has now become stiff resistance as 15800 continues to hold the highest Call OI accumulation. On the lower side, the levels of 15600 holds maximum PUT OI of 2.5 million shares followed by 2.4 million shares at 15500. So, as of now, from the present data, the trading range gets defined as 15500-15800 on Nifty for the coming week. On the Bank Nifty front, 35000 strike has seen call writing of over 1.2 million shares. Both 35000 and 35500 strikes hold similar Call OI of 1.2 million shares. On the lower side, the 35000 also holds maximum PUT OI at 1.3 million. In the case of Bank Nifty, the 35000 level is likely to act as an inflection point for the index.

Ashis Biswas, Head of Technical Research, CapitalVia Global Research

We observed the open interest has increased for both 15800CE and 16000CE the most, it implies that the option writers consider 15800 and 16000 level as a strong resistance. We have observed the maximum call writing happening at the strike 15800 with OI 4897125, indicating a strong resistance upside for Nifty 50 at 15800. Options Max Pain is currently at 15750. As of now it is expected the market to expire around 15700-15800 level. The critical level for Bank Nifty is 34700, which is expected to provide strong support. We expect Bank Nifty to bounce from the current level around 35000 and move towards 35800-36000.

(The recommendations in this story are by the respective research analysts and brokerage firms. Financial Express Online does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)

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