F&O Radar: Poised bulls may take Nifty to new highs, deploy Bull Call Spread for potential benefit
Nifty index opened positively on Tuesday. After trading within a narrow range for the first couple of hours, bulls surged, pushing it to a fresh all-time high of 23,754.
The index formed a bullish candle on the daily chart and achieved its highest-ever closing level. It traded approximately 1% higher compared to the previous week, marking a new record high following seven consecutive trading sessions of consolidation.
Follow-up buying persisted throughout the second half of the session, resulting in the index closing with gains of approximately 180 points.
The India VIX has been fluctuating between 12 and 14.50, providing overall comfort to bulls with a 'buy on decline' approach.
“Index is up by more than 5% on a monthly basis and higher by more than 550 points from its monthly averages. Volume weighted average price of the month is near 23,500 zones and the index is trading higher by 200 points from the same which indicates a bullish stance for the expiry day points of view,” said Chandan Taparia, Senior VP, Equity Derivatives & Technicals, Broking & Distribution at Motilal Oswal.
On the option front, the maximum call OI is at 24,000 then 23,600 strike, while the maximum put OI is at 23,000 and then 23,500 strike. Call writing is seen at 23,900, then 23,700, while put writing is seen at 23,400, then 23,500.
Option data suggests a broader trading range between 23,200 to 24,000 zones, while an immediate range between 23,300 to 23,700 levels.
Now, the price has to continue to hold above 23,650 zones to extend
