Nifty Bank Faces Selling Pressure, Drop in PCR hints at Growing Bearish Sentiment

“The index ended near its immediate support zone of 51,700, forming a bearish candlestick pattern at a crucial point. Trading below the psychological 52,000-mark signals weakening buying interest. The 52,500–52,600 zone has acted as a significant resistance since early October, characterized by strong call-writing, reflecting sustained selling pressure. A breakout on either side is expected to define the near-term direction. The RSI, staying below 60 since early October, reinforces a negative outlook, suggesting limited upside potential until the index clears this key resistance level,” said Dhupesh Dhameja, Derivatives Analyst, SAMCO Securities.

Nov 29, 2024, 8:26 am IST

Nifty Bank Options Market Insights By Dhupesh Dhameja, Derivatives Analyst, SAMCO Securities

The options market shows a balanced sentiment, with comparable call and put writing. The 53,000-strike call has the highest open interest at 12.31 lakh contracts, while the 51,500-strike put has seen substantial additions, totalling 5.84 lakh contracts. Positions between the 52,100–52,500 call range and the 52,000–51,500 put range reinforce resistance at 52,500 and support near 51,500. The surge in call writing between 52,100 and 52,500 highlights stronger seller activity, while reduced put writing signals an increasing bearish bias. The put-call ratio (PCR) has dropped to 0.88 from 1.97, emphasizing a growing bearish sentiment. Furthermore, the “max pain” level at 52,600 suggests it may act as short-term support.

Nov 29, 2024, 8:26 am IST

Bank Nifty Outlook Today By Dhupesh Dhameja, Derivatives Analyst, SAMCO Securities

“The Nifty Bank index is showing a cautiously bearish trend, having failed to sustain above 52,000, with significant sell-offs during upticks. The index is nearing a crucial support level at 51,700–51,800, which has been a strong support zone recently due to active put-writing. Holding above this level will be important for maintaining any upward momentum. With the index trading below the 52,000–52,500 range, sellers are controlling the price action, and upticks are likely to be met with selling pressure. Staying below 52,500 supports a “sell on rise” strategy. A breakout above 52,500 could trigger short-covering and push the index towards 53,300. However, a breach below 51,700 may increase selling pressure, leading to a further drop to 51,300.”

Nov 29, 2024, 8:23 am IST

Nifty Prediction Today

“On the daily chart, the index is now testing its immediate support zone around 23,900-23,800, a critical level that could be key to preventing further downside. After breaking the key 24,000 support, the index faces a cautious outlook as it struggles to build upside momentum. The 24,100-24,200 range, with substantial call writing, has become a significant resistance zone, suggesting strong selling pressure on any price recovery. The index needs to stay above 23,800 to maintain any upward bias; otherwise, further selling could emerge to take it below this level,” said Dhupesh Dhameja, Derivatives Analyst, SAMCO Securities.

Nov 29, 2024, 8:23 am IST

Options Market Analysis By Dhupesh Dhameja, Derivatives Analyst, SAMCO Securities

Options data reveals a bearish tone, with notable call-writing activity seen throughout the session. The 24,300-strike call has garnered the highest open interest of 50.68 lakh contracts, while the 23,500 strike put holds considerable open interest at 54.37 lakh contracts. The active positions in the 24,000–24,300 call range and the 23,900–23,500 put range emphasize resistance around 24,300 and support at 23,500. The surge in call writing from 24,000 to 24,500 highlights the growing seller strength, while reduced put writing signals a stronger bearish sentiment. The put-call ratio (PCR) decreased to 0.72 from 1.03, further underscoring the bearish bias. The “max pain” level at 24,000 suggests minimal downside risks in the near term.

Nov 29, 2024, 8:22 am IST

Nifty Outlook Today By Dhupesh Dhameja, Derivatives Analyst, SAMCO Securities

The Nifty index is exhibiting a cautiously bearish stance, having failed to hold above the 24,000 level, with any upticks will quickly encounter selling pressure. The index is now approaching a crucial support zone between 23,800 and 23,900. This area, marked by robust put-writing activity, has proven to be a strong support level in recent times. For the index to maintain an upward trajectory, it must stay above this level. As the Nifty trades below the 24,000-24,100 range, selling activity continues to cap upward momentum, making the “sell on rise” strategy favourable. A breakout above the 24,100-resistance zone could trigger a short-covering rally, pushing the index toward 24,500. On the flip side, a breakdown below 23,800 could intensify selling pressure, potentially pulling the index down to 23,500.

Nov 29, 2024, 8:18 am IST

Bank of Baroda Shares In Focus

One of the top public sector banks in India, Bank of Baroda (Bank), said today that it has generated Rs. 3,500 crore by issuing Basel III Compliant Tier II Capital Bonds. Due to the robust investor response, the bank was able to price the issuance at a highly competitive coupon of 7.41% p.a. With a base issue size of Rs. 1,000 crore and a Greenshoe option to retain oversubscription up to Rs. 2,500 crore (total issue size of Rs. 3,500 crore), the bank received 120 bids totalling Rs. 9,500 crore. This corresponds to oversubscription that is about 2.7 times the total issue size and 9.5 times the basic issue size. At a 7.41% p.a. coupon rate, the bank accepted bids for Rs. 3,500 crore. CRISIL Ratings and India Ratings have given the bonds a “AAA” rating with a stable outlook. On November 27, 2024, the bonds were put up for bid, and on November 28, 2024, they were distributed.