Technical and derivative: Markets end lower after trading with negative bias throughout the week

Let us take a glimpse into what happened in markets over this week.

Nov 01, 2020 10:11 IST India Infoline News Service

Technical
The Nifty ended the week lower as it faced selling pressure around 12000. On the weekly chart, a bearish engulfing pattern has formed which suggests pause in uptrend. 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, crucial support is placed at 11550; below which the Nifty may witness selling pressure.

Derivative
Markets traded with a negative bias during the closing part of the week as both Nifty & Bank Nifty witnessed profit booking around its resistance zone of ~12,000 & ~24,500 level, respectively. Both Nifty and Bank Nifty indices closed the week ~2.5% lower. Long gamma positions were the flavour of the week as the indices posted wild swings. FIIs index futures long/short ratio for the November series starts at 0.8x, however the total open interest is very low. Their long rollover stood at 65.5% vs. 49.2% in the previous series while the short rollovers stood at 72.6% vs. 62.6% in the previous series. 
India vix index closed the week at 24.5, up 13%.

On the options front (November 05, 2020 expiry), both call and put options added buying positions in Nifty & Bank Nifty index as the traders are expecting a sharp rise in volatility during the US Election week.

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