Nifty started the week on a muted note; however, the index slipped lower towards the end of the week. On the weekly chart, a red candle has formed. Daily RSI is in bearish crossover. On the higher end, resistance is placed at 12100; a decisive breakout above 12100 may induce strong rally in the market. On the other hand, failure to sustain above 11550 may trigger selling pressure in the market.
Markets witnessed wild swings during the closing part of the week with both Nifty & Bank Nifty index closing the week with a ~1% cut. Both Nifty & Bank Nifty index saw an unwinding of long positions during the week as profit booking weighed in. Long gamma positions were the flavour of the week as the index option writers ran for cover after a sharp delta move in the indices. FIIs index future long/short ratio surged higher above the 25x level at the start of the week however cooled off below the 2x level during the closing part of the week as they reduced their long positions in the index futures. India vix index closed the week at 21.65, up ~6%. On the options front (October 22, 2020 expiry), put option writing was seen in both Nifty & Bank Nifty as the indices trended higher during the Fridays trading session, making 11,800/23,000 level in Nifty/Bank Nifty as an immediate floor for the indices during the current weekly expiry.