Expiry Day Volatility Seen as Nifty Remains Rangebound: Analysts
The Nifty 50 index managed to snap a three-day losing streak on Wednesday, ending marginally higher. The rebound, however, did little to alter the broader technical picture as the index remains within a tight range of 24,500 to 25,200. Analysts are now expecting increased volatility on expiry day and advising investors to watch for a breakout.
The Nifty 50 index opened the day’s trading session at 24,875 and touched an intraday high of 25,134 before closing at 25,062, up by 0.12%. The index saw a moderate trading volume, with around 95% of the stocks traded in the positive zone. Despite the marginal gain, the index remains stuck in a narrow range, with the 50-day and 200-day moving averages providing resistance.
“A break above 25,200 can lead to a rally towards 25,500, while a breakdown below 24,500 can see the index test 24,300,” said Avnish Jain, a technical analyst at Tradebulls Securities. “Traders should watch for a breakout on expiry day to determine the next course of action.”
The expiry day is expected to bring increased volatility as the Nifty futures and options contracts expire. Analysts are predicting a range of 24,500 to 25,200, with the possibility of a breakout on either side.
“We expect high volatility on expiry day, and traders should be prepared for sudden movements,” said Deepak Jasani, a senior technical analyst at HDFC Securities. “A break above 25,200 can lead to a rally, while a breakdown below 24,500 can see the index test 24,300.”
The Nifty Bank index also saw a moderate trading session, ending the day at 31,564, up by 0.15%. The index has been trading in a tight range of 31,400 to 31,700 for the past few days, with the 50-day and 200-day moving averages providing resistance.
“This week’s expiry day is expected to be a crucial one, with the Nifty and Nifty Bank indices trading in tight ranges,” said Rajesh Palviya, a technical analyst at Axis Securities. “Traders should watch for a breakout on either side to determine the next course of action.”
The broader market also saw a mixed trading session, with the BSE Midcap index ending the day at 23,335, up by 0.15%, while the BSE Smallcap index ended at 24,434, down by 0.12%.
The Indian rupee also saw a moderate trading session, ending the day at 71.57 against the US dollar, a gain of 0.15%.
Overall, the Nifty 50 index remains rangebound, with analysts expecting increased volatility on expiry day. Traders are advised to watch for a breakout on either side to determine the next course of action.
