India’s benchmark Nifty plunged 207 points in the last two trading sessions after the RBI slashed repo rates by 25 bps. In today’s session, the index faced stiff resistance around 11050 approx and scaled down to make a low of 10935 approx. Although Nifty has tanked 130 points today, it did not trigger any excessive expansion in options gamma as India Vix has closed below 16 approx. These factors are indicating that the index has not entered the bearish zone yet. Going forward, if the index trades below Monday’s range low, it might enter Bear Market and trigger a selloff till 10746 approx.
The Outlook for 11th February 2019
Nifty Daily Chart Levels
In today’s session, Nifty Future plunged 130 points intraday. The index faced stiff resistance around 11050 and scaled down to 10935 approx. In the last one hour of selling, options gamma did not undergo exponential expansion. This is an indication that Nifty has not entered a Bear Market yet. Going forward, the index is likely to face resistance around Monday’s range high. If Nifty, trades below Monday’s range low, it might enter a bear market and trigger a sell-off till 10746 approx. On the other hand, if Nifty trades above Monday’s range high it is likely to scale up to 11038 approx.
Nifty Hourly Chart Levels
In the hourly session, Spot Nifty has closed around 10943 approx. The index is likely to face resistance around Monday’s hourly range high. If Nifty trades below Monday’s hourly range low, it might scale down to 10842 approx. On the other hand, if Nifty trades above, Monday’s hourly range high, it will scale up to 11023 approx.
Bank Nifty Options Data
SELF LEARNING GUIDE
How to calculate the“Range”of Nifty
Calculate Delta Neutral zones for the next trading day using “Black Scholes Model”
What is the Black Scholes Model?
The Black Scholes model is a model of price variation over time of financial instruments. The model assumes the price of heavily traded assets follows a geometric Brownian motion with constant drift and volatility. When applied to options, the model incorporates the constant price variation, the time value of money, the option's strike price, and the time to the options expiry.
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