A Record high in the Nifty a momentum of pride for us

Weekly F&O Data Analysis 28.11.22

Derivatives - FnO
by 5paisa Research Team Last Updated: 2022-12-11T04:52:09+05:30


Nifty50 28.11.22.jpeg

November month proved to be far-fetched for traders as we witnessed a significant rally in the indices with Nifty touching an all-time high and marking a new record. Our markets have outperformed the global markets in turbulent times and this latest milestone is undoubtedly a moment of pride for us. During last week, we witnessed high rollovers in November expiry wherein Nifty rollovers were at 82 percent while that in Bank Nifty were at 88 percent. The Rollovers were above their 3-month average indicating long rollovers. FII’s have rolled most of the long positions as they have started the December series with a ‘Long Short Ratio’ at 76 percent. 

The large-cap stocks from the Banking, IT, and PSU space have contributed largely to this up move in the last few weeks. The midcap space has seen a relative underperformance of late but now has witnessed buying interest in the last couple of sessions. Technically, the ‘Higher Top Higher Bottom’ structure continues for the index and until we see the index breaching any important supports, the trend remains intact.

However, although the trend for the index still remains positive, the momentum readings on the hourly chart in Nifty and on the daily chart in Bank Nifty have reached the overbought zone. Generally, overbought setups need to cool off, which could lead to either some prices or a timewise correction in the short term.

Hence, although everything seems hunky-dory at the moment, it is better not to get complacent and rather tighten the grip on money management and trade with strict stop losses. At the current juncture, short-term traders can also look to book profits on long positions and take some money off the table. The immediate support for Nifty is placed around 18400 while the medium-term support of ’20 DEMA’ has now shifted to 18200. 
 

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Disclaimer

Investment/Trading is subject to market risk, past performance doesn’t guarantee future performance. The risk of trading/investment loss in securities markets can be substantial. Also, the above report is compiled from data available on public platforms.

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