F&O Manual | Indices trade positive; call, put writers clash over Nifty at 19,850

The Indian equity benchmark indices traded in the green with a bullish overtone in the market late in the October 12 morning.

“Positive developments are strengthening the market rally. A steady decline in the dollar index and US bond yields, falling crude prices, and a significant decrease in FII selling in the cash market are major positives. If the US CPI inflation data expected tonight falls below 3.6 percent, it will boost the bulls,” VK Vijayakumar, chief investment strategist at Geojit Financial Services, said.

Concerns stemming from the Israel-Hamas conflict led to substantial short positions in the market, which are now being covered, driving the markets higher, according to him. “TCS reported mixed results, with disappointing topline figures but a strong bottomline and improved margins. The market is awaiting results from Infosys and HCL Tech later on October 12 to assess the IT segment. The rally in banking stocks still has potential.”

Options data suggests a struggle between call and put writers at the 19,850 strike. “The Nifty continues its positive momentum and is expected to close above the 19,800 zone, improving the market’s bias despite tension in the Middle East and the start of the results season. Volatility is expected as the index has near-term support at 19,760 and a near-term target of 20,000. Support for the day is at 19,700, with resistance at 19,950,” brokerage house Prabhudhas Lilladher said.

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Among individual stocks, NationAlum, Gail, CoalIndia and Bosch saw a bullish buildup. While short covering is seen in NMDC, IGL, HindCopper and Zeel.

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