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The Nifty index ended November with a modest 1% decline, but futures rollovers surged to 79.34%, indicating increased trader hedging amid expectations of a potential turning point. As December begins, open interest has risen to 1.29 crore shares, reflecting aggressive short positioning and a higher cost of carry at +0.97%, suggesting bears are betting on continued negative sentiment.
Broking firms Groww and Samco Securities have launched innovative features to encourage responsible derivatives trading among retail investors, complemented by educational initiatives to boost financial literacy. In response, markets regulator Sebi has tightened equity derivatives trading norms, limiting weekly options contracts to one per exchange and increasing the minimum trading amount to Rs 15-20 lakh. Additional measures include enhanced monitoring of position limits, upfront collection of option premiums, and increased tail risk coverage.
Nifty 50 rebounded impressively in the week ending November 22, surging 2.50% and breaking above the crucial 200-day exponential moving average, signaling a shift in market sentiment. The index has found support at 50-week EMA, with a bullish hammer pattern suggesting continued upward momentum. However, it faces psychological resistance between 23,900 and 24,000, where strong call writing indicates trader caution.
On November 19, the Nifty 50 closed at 23,519, rebounding from a seven-day decline, while the Bank Nifty rose to 50,627. Key levels to watch include 23,800 for Nifty, which could lead to a rally towards 24,000–24,500, and 51,000 for Bank Nifty, with potential movement towards 51,500–52,000.
More than 50% of stocks across major Indian indices have fallen below their 200-day moving average amid a market correction, with over 400 stocks experiencing significant declines. Analysts advise caution, particularly with low-volume stocks, while suggesting that fundamentally strong companies may find support at this level. Foreign investors have offloaded substantial amounts, contributing to the bearish sentiment, as concerns over geopolitical tensions and weak earnings persist.
The Nifty index has shown persistent bearish momentum, dropping 2.55% last week and closing below critical support at 23,800. With the index hovering near the 200 DEMA at 23,540 and approaching a demand zone between 23,300 and 23,200, selling pressure may increase if it slips below 23,480, leading to a sell-on-rise strategy dominating market sentiment.
The Nifty 50 rebounded over 370 points, closing nearly one percent higher, forming a Bullish Piercing Line pattern, indicating a positive trend. Resistance is expected at the 24,300–24,500 zone, while support lies at 24,000 and 23,800. The Bank Nifty also shows potential to rise towards 52,500, with 51,700 as immediate support.
The Nifty 50 has faced resistance near 24,500, coinciding with the 100-day EMA, closing at 24,467 after a 128-point rise. A decisive move above 24,500 could signal further gains, while support is seen at 24,100–24,000. Meanwhile, the Bank Nifty needs to hold above 52,300 and surpass 52,600 to target 53,000, with support at 51,700.
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