From Daily Nifty Ichimoku cloud chart we could see that nifty candle had just above the cloud supports 5331 and holding still above the cloud. But hourly charts are still indicating a bearish picture. And Nifty open interest data of August Series shows that as of now put writers are bullish on holding 5300 level.
Looks Put writers are not still in the panic mood to unwind their positions from the 4900PE and 5000PE in contrast they built the positions against the market bearisness. The current mood of the Put writers shows absolute bullishness and the confidence of holding 4900 and possibly even 5000 levels on EOD basis. As the world markets are in uncertainity mood its advisable to take any sort of longs with appropriate amout of hedges. Hedges are mandatory in such type of market uncertain market environment.
Last two days 5050 seems to be a valid support zone. If nifty tommorow sustains above 5050 then there is a possibility of complete reversal. As of now almost equal amout of Open Interest in both 4900PE and 5000 PE. So there is a chance of Put writing in 5000 PE zone also. Now we need to concentrate on both 4900PE and 5000PE.
Finally very high open interest builtup in 5000 CE Feb seires as expected. It symbols 5000 calls are strongly written by call writers. Which indicates that option writers for time being considering 5000 as strong resistance point Related Readings and Observations 5/13 EMA Weekly Crossover likely to happen in Nifty – 3 Feb 2010 Source: […]