Excessive Options Gamma Expansion Triggers Volatility In Nifty


Nifty underwent a volatile day of trading as the abnormal expansion of the option's gamma pushed up premiums as high as 50 points intraday. The index fell 89 points after making a high of 11525 around mid-day and went on to make a low of 11436. Nifty, however, recovered 126 points from the day’s low and made a high of 11562 towards the last hour of trading today. These fast-intraday moves triggered an expansion in the option's gamma and pushed up the volatility index above the last two-month high at 14.20. Nifty closed at 11538, which is a neutral zone and will play a vital role in deciding the direction of the market in tomorrow’s trade. 

Stocks Under The Scanner
In today’s trade Reliance shares rose 2.77%, while Cipla shares rose 2.31%. Zee Entertainment Ltd. shares dropped 2.44% in the course of the day’s trade.



 
The Outlook for 7th September 2018
Nifty Daily Chart Levels
In today’s trading, Nifty closed around 11538, which is a neutral zone and will play a crucial role in forming the direction of the market in tomorrow’s session. The benchmark index took the support of the 34 DMA (11430 approx) today and traded above the 5 DMA (11561 approx) for a brief while. Nifty closed marginally below the 20 DMA (11538 approx) and tomorrow’s session will be crucial in deciding the short-term direction of the market. Going forward, Nifty is likely to face stiff resistance around 11600 approx and the nearest downside target for the index is around 11400 approx. However, if Nifty trades above the 5 DEMA high (11625 approx), it will find its next upside target around the upper Bollinger band (11740 approx)

Nifty Hourly Chart Levels
In the hourly session, Nifty closed above the 5 DEMA high (11538 approx). The nearest upside target for the index is around the 100 HMA (11600 approx). However, if Nifty breaks and trades below the 5 HMA (11500 approx), the nearest downside target is around the hourly mid-Bollinger band (11480 approx).





Nifty Large & Mid Cap Stocks




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Nifty underwent a volatile day of trading as the abnormal expansion of the option's gamma pushed up premiums as high as 50 points intraday. The index fell 89 points after making a high of 11525 around mid-day and went on to make a low of 11436. Nifty, however, recovered 126 points from the day’s low and made a high of 11562 towards the last hour of trading today. These fast-intraday moves triggered an expansion in the option's gamma and pushed up the volatility index above the last two-month high at 14.20. Nifty closed at 11538, which is a neutral zone and will play a vital role in deciding the direction of the market in tomorrow’s trade. 

Stocks Under The Scanner
In today’s trade Reliance shares rose 2.77%, while Cipla shares rose 2.31%. Zee Entertainment Ltd. shares dropped 2.44% in the course of the day’s trade.



 
The Outlook for 7th September 2018
Nifty Daily Chart Levels
In today’s trading, Nifty closed around 11538, which is a neutral zone and will play a crucial role in forming the direction of the market in tomorrow’s session. The benchmark index took the support of the 34 DMA (11430 approx) today and traded above the 5 DMA (11561 approx) for a brief while. Nifty closed marginally below the 20 DMA (11538 approx) and tomorrow’s session will be crucial in deciding the short-term direction of the market. Going forward, Nifty is likely to face stiff resistance around 11600 approx and the nearest downside target for the index is around 11400 approx. However, if Nifty trades above the 5 DEMA high (11625 approx), it will find its next upside target around the upper Bollinger band (11740 approx)

Nifty Hourly Chart Levels
In the hourly session, Nifty closed above the 5 DEMA high (11538 approx). The nearest upside target for the index is around the 100 HMA (11600 approx). However, if Nifty breaks and trades below the 5 HMA (11500 approx), the nearest downside target is around the hourly mid-Bollinger band (11480 approx).





Nifty Large & Mid Cap Stocks




 
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