NIFTY

NIFTY WEEKLY
Important points to consider.
1> Nifty closed above the Bollinger band average and theoretically is poised to test the upper band at 5200 but first it needs to cross some resistance
2> Nifty has closed above 5,10,20,50 DMA which is a bullish signal
3> It has also closed above 61.8% retracement of its recent fall
4> After the recent expansion the Bollinger bands have started to contract again which means nifty will become range bound and the nifty options will loose value rapidly hence it is avoidable to buy options for positional trades.

The next resistance lies at 5040-5050 and a close above it will most probably set up nifty for a test of its recent high of 5190. IN the chart even the TWIGGS MONEY FLOW line is at resistance point.
The supports are at 4900 which is also the 50 DMA; below it support is at 4850.

NIFTY OI DATA
1> 5000 PE have added OI along with decrease in OI of 5100 CE which is a bullish sign.
2> 4900 PE has OI of more than 56 Lacs which means 4900 is a strong support
3> 5100 CE has added OI which means 5100 will act as resistance
4> Considering the above data nifty is likely to be in a range of 4900 to 5050 above 5050 the call writers will start covering there position, and if nifty stays within the range options writers will gain as they will eat away both 4900 put and 5100 call premium
5> The futures added OI on a UP day which again is bullish and means that nifty can test 5050

On the basis of the above data a sharp move is possible only on either side of 4900or 5050 till then nifty is range bound and hence buying options for positional trades is best avoided
Below 4900 nifty can test 4850 and below it 4700. Above 5050 nifty ca test 5190

RELIANCE closed above its strong resistance of 2100 and the next resistance to watch is 2150 above which it can test 2263