Nifty and Bank Nifty OutlookBenchmark indices ended the volatile session of May 16 in the green, buoyed by the rise in global equities following strong US inflation data, fueling expectations of Federal Reserve rate cuts.
Analysts suggest that Nifty needs to hold above the 22,350 level for an upmove towards 22,550 - 22,700, while Bank Nifty needs to stay above 47,777 to sustain upward momentum.
The Nifty 50 settled 203 points or 0.92 percent higher at 22,403.85, and Nifty Bank rose 290 points or 0.61 percent to 47,977.05 on Thursday.
To sustain upward momentum, it needs to maintain levels above 47,777, targeting a bounce towards 48,250 - 48,500 zones.
Support levels are seen at 47,777 - 47,500.
Nifty and Bank Nifty Outlook
Benchmark indices ended the volatile session of May 16 in the green, buoyed by the rise in global equities following strong US inflation data, fueling expectations of Federal Reserve rate cuts. Analysts suggest that Nifty needs to hold above the 22,350 level for an upmove towards 22,550 - 22,700, while Bank Nifty needs to stay above 47,777 to sustain upward momentum.
The Nifty 50 settled 203 points or 0.92 percent higher at 22,403.85, and Nifty Bank rose 290 points or 0.61 percent to 47,977.05 on Thursday. About 1,286 shares advanced and 990 shares declined on NSE.
Story continues below Advertisement Remove Ad
Nifty outlook and strategy
Chandan Taparia, Head – Equity Derivatives and Technicals, Broking and Distribution, MOFSL
Nifty formed a bullish candle on the daily timeframe with a longer lower shadow, indicating strong support-based buying, and has started forming higher highs for the last four sessions. Now, it has to hold above the 22,350 zones for an upmove towards 22,550 - 22,700.
Key Resistance: 22,600-22,775
Key Support: 22,000
Strategy: Buy on decline and bull call ladder spread
Story continues below Advertisement Remove Ad
A bull call ladder spread involves buying a call option, selling two higher-strike call options, and buying another higher-strike call option, typically used when moderately bullish on a stock's price movement.
Kunal Kamble, Sr. Technical Research Analyst at Bonanza Portfolio
Nifty is trading within a rising parallel channel, consistently respecting the lower rising trend line. The index has found strong support at the 45-day EMA. Thursday's trading session witnessed a surge in volume, reflecting increased buyer interest. PE option writers are active at lower levels, particularly at 21,800, 21,700, and 21,500. Call buyers have shown aggression in the last two days, suggesting a bullish sentiment. Any downward movement presents a buying opportunity as long as Nifty sustains above 21,700 levels.
Also Read: Taking Stock | Sensex surges 676 pts, Nifty above 22,400; M&M, Bharti Airtel, Tech Mahindra top gainers
Key Resistance: 22,530-22,750
Key Support: 22,200-21,750
Strategy: Buy on dips
Bank Nifty - outlook and positioning
Chandan Taparia - MOFSL
Bank Nifty has formed a pin bar pattern on the daily scale, characterized by a long lower shadow, indicating buying interest at lower levels. To sustain upward momentum, it needs to maintain levels above 47,777, targeting a bounce towards 48,250 - 48,500 zones. Support levels are seen at 47,777 - 47,500.
Key Resistance: 48,500
Key Support: 47,500
Strategy: For the weekly expiry on May 22, execute a Bull Call Spread strategy by buying 1 lot of 48,000 Call option at Rs 350 and selling 1 lot of 48,500 Call option at Rs 150
Stoploss: Buy on-decline strategy, supported by the 47,500 zones, aiming for a target of 48,500 levels
Also Read: Gainers & Losers: 10 stocks that moved the most on May 16
Kunal Kamble - Bonanza Portfolio
The Nifty Bank has formed a rising parallel channel, finding support along the trend line and closing above the 45-day EMA. The rise in volume suggests increased buyer interest in the index. Additionally, heightened buying in CE options reflects buyer interest, while PE writers are adding new positions, indicating an uptrend.
Key Resistance: 48800-49300
Key Support: 47100-46750
Strategy: Buy
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
