Expect strong resistance above 5,950

The Nifty April futures moved between resistance (5,970) and support (5,880) and settled above the support level at 5,910 on short covering. The market picture chart for Wednesday suggests responsive selling, as the Nifty after opening within the value area attempted to trade above the value area. Sellers entered the market at the higher level (5,971) and auction price back into the value area. This shows responsive sellers stepping into a market trading above value and taking advantage of the high prices. This type of market profile also hints at sideways market. The responsive selling is expected to continue for a few more sessions and we may see some minor correction in the Nifty. The initial balance range (5,932-5,971), the first two trading periods of 30 minutes each, saw change of hands and 64 per cent volume, which indicate that the Nifty may face selling pressure in the IB range tomorrow. However, 63 per cent volume in the first three trading sessions, mostly buy-side, indicates short covering from the floor traders. The value area (5,898-5,942) –70 per cent of the price points – saw buy-side bias but also selling pressure above 5,930.

The point of control (PoC), the area of most traded price, suggest a net selling day as the time-price opportunities (TPOs) counts were greater above the PoC.

The Nifty April futures closed at a 19-point premium and shed 1 million shares in the open interest during the intraday trade, indicating profit booking at the higher levels. The market picture chart suggests price-based resistance in the Nifty April futures above 5,947. The price based support for the Nifty April futures is expected to come around 5,852. The spot Nifty could get support at 5,847 and an upside resistance is seen at 5,947.

The Bank Nifty is expected to move up around 11,875 and to get strong support at 11,700. April futures of State Bank may face resistance at 2,843, while buying support is seen at around 2,770. Reliance Industries expected to move up around 1,050 while support is seen at 1,037.

The change of hands seen in the 6,000-strike put options, as participants expect the Nifty to face resistance above 6,000. The participants also hedge the long positions through buy-side trades in the 6,000-6,100-strike put options.