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Trade setup for Friday 31, January 2020

All you need to know as a trader or Investor

Sensex closed 285 points, lower at 40,913.82 while Nifty lose 94 points and closed at 12,035.80.

Today's session most likely to be derived from upcoming Union budget and may see som bounce back from this level and high volatility is expected.

SGX nifty closed higher by 20 points on 30 January which shows positive opening for nifty.

Option Analysis:

Maximum open interest on call side at 12100 of 52.42 lakh contracts.

Significant call writing was seen at 12100 strike price almost 35 lakh new contracts get added which means sentiments for nifty is negative among big players or traders in the market.

Call unwinding was seen at 12300 strike price which supports the traders negative bias towards the market.

Maximum open interest on put side at 12000 strike price of 49 lakh which is more than 10 lakh from yesterday its like trader are assuming that nifty will definitely not going to breaches this level.

Put writing was seen at the 12,000 strike price 15 lakh new contracts gets added.

Put unwinding was seen at the 12100 strike price.

What to look for:

As per technical analysis nifty may pull back from this level as in short time of frame there is classic inverted hammer which indicates the reversal from this level and we have seen in the past that nifty follow this pattern beautifully. So, in the early session of the trade nifty may rally toward 12100- 121500. However, on longer time frame it shows some weakness. But due to budget day ahead we may see heavy buying and selling in both to protect and get benefited from the volatility.

Disclaimer: All the information shared only for learning purpose, we do not provide any tip or recommendation. Please do consult with your investment adviser before making any trade or investment decision.


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