NIFTY WEEKLY

NIFTY WEEKLY
On the weekly charts the nifty has broken upwards its resistance trend line as seen in the chart, and now the broad weekly support is at 4658 on weekly basis.
NIFTY DAILY
On the daily charts the nifty has broken out of contracting price range and has shown consolidations for last two days the supports on the daily charts are at 4888-4829-4730 in that order. Resistance on candle charts lie at 5020-5075-5160 in that order, while the index itself continues to make new highs the RSI hasn’t made one which calls for caution against building up large speculative long positions. Expect the region of 4829-4800 to offer strong support as it is an important fibo level and also the nifty spent sometime consolidating there before touching 5000.
OI DATA
On the calls side 4900 calls have shown decrease in OI and at the same time 4900 puts now have an OI of 43 lac thus suggesting expiry to be above 4900
Interestingly 5000 calls have added OI and so has 5000 puts and both have neck to neck open positions which opens up the possibility that if the global cues remain strong the nifty might just be headed above 5000 this expiry.
In the October series 4800 puts already are showing good build up of positions thus increasing the importance of support at 4800 and 5200 calls have showing good buildup of OI which suggest resistance at 5200
Other DATA weekly basis (experimenting a bit)
1> The average volume on advancing stocks for the week was 6402 CR and the same on declining
Stocks was 2607 CR (suggests underlying strength in the market)
2> The advancing stocks accounted for 71% of total volumes and declining stocks accounted for 29% of total volumes which suggest lack of weakness in the market
3> The average volumes on advancing days for the whole week was 9697 CR and the same on declining day was 6265 CR which again suggests lack of weakness in the market
Looking at all the above data it might not be a good idea to short this market, instead of looking for opportunities for shorting keep looking for trades on long side.
Medium term long positions can be kept open as long as 4650 holds
Being a expiry week don’t expect a whole lot of action and the stocks and nifty are expected to bounce in the 4900-5000 range however do watch out for the OI in 5000 calls, if it starts to decline it may well signal that nifty is about to expire above 5000.