Wednesday, 26 October 2011

F&O tracker: A close below 5000 may reverse trend

The market remained very volatile all through the October series, but 4750 on a lower side acted as a good support. And on the higher side, 5150-5170 acted as a strong hurdle from where the Nifty has taken a U-turn six times in a row.

The Nifty has seen some buying ahead of auspicious occasion of Diwali, but the announcement of a 25-bp hike in repo rate & deregulation of savings bank deposit by the RBI acted as a gyrating point which triggered a selloff in the market, but bulls made a smart comeback in the second half and closed the session & the October series expiry at day's high passing all previous hurdles. On the option side, November series options have seen good addition in OI.

On the call side, 5200-5400 has the highest number of shares whereas on the put side, 4900 has the highest number of shares. Volume Weightage Average Price for the October series stands at 5050 and the Nifty has given a close well above this levels indicating overall bias remains positive and only a close below 5000 will act as a trend reversal.

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