Gap-Up Opening Loading. Short Covering in BANKNIFTY? - Pre-Market Analysis Report

What Happened yesterday?

NIFTY started the day with a gap-up at 21,480 and fell. After breaking Monday’s low in the first hour, the index started to bounce back up. Eventually, a fresh all-time high was created at 21,500. NIFTY closed at 21,453, up by 35 points or 0.16%.

U.S. markets closed in the green(+0.68%). The European markets closed in green.

What to Expect Today?

Asian markets are trading in the green.

The U.S. Futures are trading flat.

GIFT NIFTY is trading in green at 21,613.

All the factors combined indicate a gap-up opening in the market.

NIFTY has supports at 21,400, 21,360 and 21,290. We can expect resistances at 21,500, 21,550 and 21,600.

In NIFTY, the highest put OI is at 21,400 and the highest call OI is at 21,500. PCR is 0.99.

BANKNIFTY has supports at 47,800, 47,600 and 47,500. We can expect resistances at 48,000, 48,200 and 48,500.

In BANKNIFTY, the highest put OI is at 47,800 and also the highest call OI is at 48,000. PCR is 0.89.

Yesterday, Foreign Institutional Investors net-sold shares worth Rs Rs 601 crores. Domestic Institutional Investors net-bought shares worth Rs 293=4 crores.

INDIA VIX is flat at 13.86.

Yesterday, our market showed that it still has strength even in tough conditions. The index broke Monday’s low initially but went on to touch 21,500.

FINNIFTY traded in a relatively small zone, even though its levels were not respected too much. Aggressive call sellers initially would have gotten a bit burned if they failed to react to the morning bounce back.

Today, there is a green flag all through the market. For the BANK NIFTY expiry, there is a lot of call selling happening at the 48,000 level. Put sellers are also aggressive. 

But for the initial 10 minutes of the day, we will have to see how BANK NIFTY opens. There is a possibility that current call sellers at the 48k level might get burned and trigger a short covering.

Hence, expecting a trading range between 47,800 and 48,200 for the BANK NIFTY expiry today. You will definitely get a wider range for option-selling trades as the VIX is higher this week.

All the best for your trades today!

We will be modifying our NIFTY and BANK NIFTY 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!