By Ravi Singh
The Nifty outlook for the upcoming week remains negative, despite a marginal 1% gain over the past week. The current market sentiment indicates a “Sell on Rise” strategy, suggesting that any upward movements in the index are likely to face selling pressure. A decisive close above 24,400 would be required to trigger a shift toward positive market sentiment. Currently, the highest Open Interest (OI) in Nifty’s January weekly options is concentrated at the 24,000 call and 23,000 put strikes. Specifically, the 24,000-call option has an OI of approximately 9 million contracts, while the 23,000 put option stands at around 8.5 million contracts. In terms of market flows for January, Foreign Institutional Investors (FIIs) have been net sellers, disposing of a total of ₹7,078 crore, while Domestic Institutional Investors (DIIs) have been net buyers, accumulating a total of ₹8,282 crore.
The outlook for Bank Nifty remains negative for the upcoming week. The 51,000 level is acting as immediate resistance for any further upside movement. For the January monthly expiry, Open Interest (OI) is largely concentrated at the 49,000 Put option with approximately 1.2 million contracts and the 52,000 Call option with 2.15 million contracts.
Key Levels to Watch:
For Nifty, the bias remains “SELL ON RISE” for the weekly expiry of the January series, as long as the index trades below the 24,200-24,400 range on a spot basis. We expect strong resistance in the 24,200-24,400 zone, while immediate support is likely to be found around the 23,300-23,100 levels. Therefore, the expected trading range for Nifty during the January series is between 23,200 and 24,200.
For Bank Nifty, significant resistance is anticipated around the 51,000-51,600 levels, while immediate support is likely between 49,700-49,200. We foresee the index trading within a broader range of 49,000-51,000 during the January series.
STRATEGY FOR THE WEEK:
NIFTY SHORT STRANGLE:
SELL NIFTY PUT 23300 @ 22
SELL NIFTY CALL 24100 @ 24
SPREAD 46 SL 72 TGT 5 (EXP 09 JAN)
(Disclaimer: Dr. Ravi Singh is the SVP- Retail Research, Religare Broking Ltd. Views, recommendations, opinions expressed are personal and do not reflect the official position or policy of Financial Express Online. Readers are advised to consult qualified financial advisors before making any investment decisions. Reproducing this content without permission is prohibited.)
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