India VIX fell 6.47 per cent from 18.40 to 17.21 level. A spurt in India VIX is causing a volatile swing, but a decline in volatility in the last two sessions may trigger some consolidation. Now it has to cool down below 15-14 levels to ensure a smooth ride for the market.
Since it is the beginning of the new series, Option data lay scattered at various far-off strikes. Maximum Put OI was seen at 17,000 level followed by 17, 500 while maximum Call OI stood at 18,000 level followed by 18,500. Options data suggested a broader trading range between 17,000 and 18,200 levels while the immediate trading range was seen between 17,350 and 17,850 levels.
Bank Nifty opened with a gap down and weakened by 300 points from its opening level. Later, it recovered well from the lows and closed above the 37,200 level with a loss of around 200 points. It formed a bullish candle with a long lower shadow on the daily scale and a bearish candle on the weekly chart. Now it has to hold above 37,300 level to witness a bounce towards 37,850 and 38,000 levels, while on the downside major support was seen at 36,850 and 36,500 levels.
Nifty futures closed negative with a loss of 0.58 per cent at 17,521 level. Among specific stocks, the trade setup looked bullish in Manappuram, Dixon, Delta Corp, Bata India, TVS Motor, M&M, Tata Power, Granules, Gail, Amara Raja Battery, Canara Bank, Coal India, Astral, McDowell, ONGC and Reliance but weak in Cummins India, Gujarat Gas, Mphasis, Bharti Airtel, Asian Paint, Tata Consumer Products, Britania, TCS and Infosys.
(Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)