Can Aggressive Bears Sustain the Gap-Up? - Pre-Market Analysis Report
What Happened Yesterday?
NIFTY started the day with a small gap-up at 21,751 and tried to break Friday’s high. Once the fall started, the index kept on making lower lows and reached 21,500 by the end of the trading day. NIFTY closed at 21,513, down by 197 points or 0.91%.
U.S. markets closed in the green. The European markets closed in the green.
What to Expect Today?
Asian markets are mostly trading in the green.
The U.S. Futures are trading in red.
GIFT NIFTY is trading in green at 21,700.
All the factors combined indicate a gap-up opening in the market.
NIFTY has supports at 21,500, 21,400 and 21,340. We can expect resistances at 21,600, 21,680 and 21,750.
BANKNIFTY has supports at 47,420, 47,200 and 46,950. We can expect resistances at 47,600, 47,800 and 47,900.
FINNIFTY has supports at 21,270, 21,200 and 21,100. We can expect resistances at 21,380, 21,480 and 21,560.
In NIFTY, the highest put OI is at 21,500 and the highest call OI is at 21,700. PCR is bearish at 0.61.
In BANKNIFTY, the highest put OI is at 47,500 and one of the highest call OI is at 48,000. PCR is bearish at 0.59.
In FINNIFTY, the highest put OI is at 21,000 and one of the highest call OI is at 21,400 and 21,500. PCR is bearish at 0.59.
Foreign Institutional Investors net-bought shares worth Rs 16 crores. Domestic Institutional Investors net-sold shares worth Rs 156 crores.
INDIA VIX increased to 13.46.
NIFTY gave a good red candle in the market yesterday. It went down and took support at 15 December’s high of 21,500.
Based on the international markets' performance overnight, it looks like the market is set to open with a gap-up. The GIFT NIFTY is indicating a gap-up of more than 120 points.
This will be a good thing for the market as it takes support and moves back up. BANKNIFTY also has a chance to bounce from the 20-EMA level in the daily chart.
Major contributors to the U.S. rally yesterday were tech stocks. Have a watch out for movement in our IT stocks today, results start coming out on Thursday.
INDIA VIX increased yesterday and gave volatility as expected. And today, the game would be how far call sellers can hold their levels without running away.
Even in NIFTY expiry for Thursday, there is good call selling at 21,600 and above. This is where the market is expected to open today.
There are 2 chances: 1. The market is shooting up quickly in the first 15 minutes or 2. The market consolidates near the 21,600 mark with high call unwinding. I would be more confident about a sustained bullish trade in the second scenario.
We will be modifying our NIFTY and BANKNIFTY trades today. You can check out our trades on marketfeed app or our website!
Make sure that you tune in to The Stock Market Show at 7 PM on our YouTube channel. All the best for the day!