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Informist, Friday, Mar. 21, 2025

By Alina Geogy

MUMBAI – The Nifty 50 clocked yet another sharp rise and inched closer to the 23400-point mark on Friday. This upmove in the index--for the fifth straight day--encouraged traders to cover their short positions in the futures and options chain of the benchmark index.

Sentiment in the market turned positive after the Nifty 50 decisively crossed its short-term resistance of 22700 points this week. The bullish view was further cemented as the index surpassed its 20-day and 50-day simple moving averages. On Friday, the Nifty 50 ended at 23350.40 points, up nearly 160 points or 0.7%. It had briefly crossed 23400 points during the day, though it did not stay above the mark for long. It gained more than 4% this week.

There might be a consolidation in the market next week or even a slight pullback following the strong upmove over the past few days, said Anshul Jain, head of research at Lakshmishree Investment and Securities. The Nifty 50 will find immediate support at 23200 points, followed by 23050 points, he said. This consolidation will set the tone for the next upmove of the index in the week that follows, he said. Several analysts pointed out foreign investors were still net short on index futures, and that their positioning would be monitored ahead of the expiry of the March derivative series of the Nifty 50 on Thursday.

Short positions were covered in the March futures contract of the index on Friday. The contract closed at 23382.10 points, up 0.8% from the previous close. Open interest in this contract fell 3% to nearly 15 million.

Bullish bets were also seen in the weekly options contracts of the Nifty 50 expiring Thursday. Both the highest open interest concentration and the maximum change in open interest were at the 23000-put strike, indicating strong support at this level in the near term. Premium in this contract fell nearly 62%.

Among call options, the highest change in open interest was at the 24100-strike, which is around 750 points higher than the current level. Premium on this contract rose 37%. Meanwhile, the maximum open interest among call contracts was at the 24000-strike.

"We are of the view that the short-term market texture is bullish; however, due to temporary overbought conditions, we could see some profit booking at higher levels," Amol Athawale, vice president – technical research at Kotak Securities, said in a note. "For traders, buying on dips and selling on rallies would be the ideal strategy," he said.

--Nifty 50 Mar closed at 23382.10, up 181.85 points; 31.70 point premium to spot index

--Nifty 50 Apr closed at 23534.35, up 187.85 points; 183.95-point premium to spot index

--Nifty 50 May closed at 23660.00, up 201.80 points; 309.60-point premium to spot index

ICICI Bank, Bajaj Finance, HDFC Bank, Reliance Industries, Infosys, Kotak Mahindra Bank, Bharti Airtel, Axis Bank, Tata Consultancy Services, Bajaj Finserv, BSE, Adani Enterprises, State Bank of India, Zomato, Hindustan Aeronautics, NTPC, Wipro, Hindustan Petroleum Corp, Tata Motors, ITC, Bharat Electronics, Mahindra & Mahindra, DLF, Larsen & Toubro, Maruti Suzuki, Trent, and Hindalco Industries were the most actively traded underlying stocks on the National Stock Exchange.  End

Edited by Akul Nishant Akhoury

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