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Informist, Tuesday, Mar. 18, 2025

 

By Alina Geogy

 

MUMBAI – Traders placed bullish bets on the derivatives contracts of the Nifty 50 on Tuesday after a sharp rise in the benchmark index took it over 22800 points. The Nifty 50 rose as much as 1.6% to a three-week high of 22857.80 points during the day, extending its rise to the second consecutive session. Positioning in options suggested a bullish sentiment in the market as the Nifty 50 closed significantly above the 22650–22700 point zone, which acted as a major resistance over the past three weeks, according to analysts.

 

The Nifty 50 opened sharply higher and sustained most gains through the session. It closed at 22834.30 points, up 325.55 points or 1.5%. Strong gains in banking stocks supported the rise. Only four stocks in the Nifty 50 index ended lower. After a long consolidation, the Nifty 50 successfully surpassed the 22600-resistance zone, and positive momentum intensified following this breakout, Shrikant Chouhan, head of equity research at Kotak Securities, said in a note.

 

The market is currently trading comfortably above the 20-day simple moving average, which also indicates a further uptrend from current levels, Chouhan said. "The short-term market outlook is bullish, but for day traders, buying on intraday corrections and selling on rallies would be the ideal strategy," he said.

 

The 23000-strike price had the highest volume among call options of the Nifty 50 expiring this week. This contract also had both the maximum open interest and highest change in open interest, indicating a likely strong resistance at this level, which is 0.7% higher than the current level. Premium on the 23000-strike surged 620% to INR 33.50. On the other hand, premiums on the Nifty 50's weekly put options fell 20-85%, with the most active put contracts being the 22600 and 22700 strike prices. These two levels are 0.6-1.0% lower than the Nifty 50's closing level on Tuesday.

 

The March futures contract of the Nifty 50 closed at 22902.25 points, at a premium of 67.95 points to the spot index. Open interest in this contract fell nearly 1% to 17.06 million, as per provisional data

 

Tuesday was a fairly positive day for most equity markets across Europe and Asia. Benchmark indices in Japan and South Korea closed sharply up, with gains of about 1?ch. Benchmark indices in the US also ended higher on Monday as the market cheered a slight rise in retail sales in February amid ongoing worries that US President Donald Trump's trade policy could harm consumption.

 

Gains across these markets came as a breather after losses over the past few weeks when investors attempted to come to terms with Trump's unpredictable tariff and trade policies. While trade barriers aimed at China, Mexico, and Canada went into effect this month, Trump has said more tariffs would follow in April.

 

The outlook for the market remains positive, but traders should remain cautious with the upcoming US Federal Reserve's monetary policy announcement as it could trigger volatility, Rajesh Bhosale, equity technical analyst at Angel One, said in a note. The Nifty 50 is expected to retest the psychological 23000 mark, which aligns with the 50-double exponential moving average and the dynamic trendline resistance formed by connecting major tops from all-time highs, he said. The previous resistance zone of 22650–22700 can now serve as immediate support, he said.

 

--Nifty 50 Mar closed at 22902.25, up 317.95 points

--Nifty 50 Apr closed at 23049.00, up 320.10 points; 214.70-point premium to spot index

--Nifty 50 May closed at 23155.00, up 328.80 points; 320.70-point premium to spot index

 

ICICI Bank, HDFC Bank, Reliance Industries, Bajaj Finance, Kotak Mahindra Bank, State Bank of India, Axis Bank, Bajaj Finserv, Zomato, Infosys, Tata Consultancy Services, Tata Motors, Bharti Airtel, Adani Enterprises, Hindustan Aeronautics, Mahindra & Mahindra, and Tata Steel were the most actively traded underlying stocks on the National Stock Exchange.  End

 

Edited by Saji George Titus

 

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