Nifty has formed a Rickshaw Man candlestick pattern on the weekly chart, which has a bearish significance when occuring after a rally. On the daily chart, the index failed to make a new high. The daily RSI is in a bearish crossover and falling, which suggests negative price momentum. On the lower end, immediate support is pegged at 11900, below which correction may expand towards 11700 over the short term. Resistance is seen at 12200. Above 12200 Nifty may scale up towards 12350 and higher.
Markets witnessed whipsaw moves throughout the week as both Nifty & Bank Nifty witnessed selling pressure in the closing part of the week. The Bank Nifty index underperformed the Nifty index by ~1%. Both the indices have added heavy short positions since the start of the February series as open interest has surged higher along with a fall in the underlying price. FII’s index future long/short ratio continued to hover around the 0.2x mark as the short positions overweighs the long positions. India vix index closed the week on a flat note at 13.6. On the options front (February 20, 2019 expiry), Nifty and Bank Nifty call options saw heavy writing positions as the underlying price trended lower.