Edited excerpts from a chat:
After Nifty broke its 6-day-long winning streak on Friday, how bearish or bullish are you for the outlook ahead of the August series expiry next week?
After several days of gains, Nifty took a breather on Friday, resembling a pause before the next leg of the up move. The index has been sustaining above the 50 EMA, confirming a short-term uptrend. On the downside, support is placed at 24,800; as long as it holds above this level, the trend is likely to remain strong with potential to rise towards 25,000/25,250.
Nifty Bank erased all its gains during the week. What are your targets for the holiday-shortened week ahead?
The Bank Nifty continues to underperform the Nifty, posting a lackluster performance during the week. On the daily chart, the index has broken below its recent consolidation and slipped under the 50 EMA. On the weekly chart, it has declined towards the 20 EMA, where it is expected to find support and attempt a reversal. However, if it falls below 54,950, it may extend the decline towards 54,500. On the higher side, resistance is placed at 55,500, and sentiment is likely to remain weak as long as the index trades below this level.
Ever since Sebi’s Jane Street order came out, the market has seen some impact on F&O volumes, particularly on expiry days. Once BSE and NSE expiry day swap comes into effect from September, what do you think could be the impact on volumes?
Immediately after the ban, volumes saw a sharp decline of about 30%. While they eventually recovered to some extent, they have not returned to pre–Jane Street levels. In the short term, a negative impact on volumes may still be felt; however, in the long run, broader participation is likely to drive higher volumes as traders increasingly utilize both NSE and BSE expiries.
And how would your Nifty trading strategy shift once we have Tuesday expiries? Do you think that the first few weeks of the shift could be stressful for traders?
With the shift to Tuesday expiries, the trading strategy for Nifty options will need some adjustment. The first few weeks may indeed be stressful for traders as they adapt to the new cycle. Option premiums will likely see the sharpest time decay between Friday and Monday, making Mondays far more dynamic. As a result, Mondays will become the second most important day for Nifty option traders, with positions being actively reviewed or fresh trades initiated ahead of Tuesday’s expiry.
Ola shares were among the top gainers in the week. Do you think the momentum will sustain?
On the weekly chart, Ola has failed to close above the important average 20EMA on the weekly chart, this is a bit negative for the price trend. However, if the stock moves above 48 in the early days of the next week it might move towards 54/56. On the other hand, support is placed at 46.60.
Give us your top ideas for the week ahead
Buy UNO Minda at ₹1266 | Target: ₹1330 | Stop Loss: ₹1219
The stock has moved higher after a brief consolidation on the daily chart, indicating renewed optimism. It is trading comfortably above the 50 EMA, confirming a bullish trend, while the RSI has entered a bullish crossover following the breakout. In the near term, the trend is expected to remain positive with potential upside towards 1,330. On the downside, support is placed at 1,219.
Buy Lupin @ ₹1970 | Target: ₹2050 | Stop Loss: ₹1924
Following a bullish harami pattern formation the stock moved up higher which is an indication of bullish reversal. The price has been sustaining above important 50EMA. The RSI is in bullish crossover. In the short term, the stock might move towards 2030-2050. While, a support is palced at 1924.
Sell Axis Bank @ ₹1070 | Target: ₹1040 | Stop Loss: ₹1086
The stock has slipped from its recent consolidation, suggesting growing bearish sentiment. Moreover, it has been trading below the 21 EMA on the daily timeframe. The RSI is on the verge of a bearish crossover. In the short term, the stock may drift lower towards 1,040, while on the upside, resistance is placed at 1,086.