Strong support at 5,600

The market is bullish above the level of 5,750 on Nifty futures. One could get bullish confirmation only if the Nifty futures close above 5,750. The market would weaken below 5,650. Kamlesh Langote, VFMDirect, said that today’s breakdown below yesterday’s low is not a good sign.

The next immediate support exists at 5,500, where considerable put writing exists. However, a truncated session such as today’s, marked by low volumes, could give wrong break-downs/break-outs and hence Monday’s session would be crucial.

Stock-specific action was seen in National Aluminium, Gail, Neyveli Lignite, Federal Bank, Bajaj Hindustan, Power Finance, GMR Infrastructure and Oswal Chemicals last week, with the prices of November futures moving up by over 10 per cent accompanied with a sharp increase in open interest.

Bajaj Hindustan November futures closed at 218.55, up 14.8 per cent, while the OI increased by 2.3 million shares or 42.2 per cent.

Federal Bank futures surged 15.9 per cent, while the OI increased by 31.6 per cent.

GMR futures closed 13 per cent up and the OI increased by 22.8 per cent.

The firming up in open interest, coupled with the appreciation in stock futures by over 10 per cent, points towards further bullishness in the above mentioned stocks.