F&O Radar | Deploy Short Iron Butterfly in Nifty for potential gains from a consolidated index
Nifty Index, trading near the 24,000 mark seems to be getting stuck within 50 DEMA of 24,212, 100 DEMA of 24,249 on the upper side and 20 DEMA of 24,017 and 150 DEMA of 24,026 DEMA on the lower side.
In the previous week, a positive breakout in Nifty was seen but the momentum fizzled out on Friday as the index didn’t manage to break the resistance at 61.8% Fibonacci level of 24,248 and gave away partial gains by closing 183 points, lower than the previous day.
Nifty is trading at a Relative Strength Index (RSI) of 48.34 and is trending downward which suggests bearishness but it has support available around 46.51.
“Option data reveals unwinding in the money (ITM) put strikes of 24,200 again suggesting bearish momentum but on the weekly chart, Nifty closing is moving higher and RSI trending upward suggesting bullish momentum with support at 50 weekly EMA of 23,442 and resistance at 20 weekly EMA of 24,239,” said Preeti K Chabra, Founder of Trade Delta.
Chabra said that she expects some consolidation in Nifty unless there is a breakout above 24,250.
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