No Reason For Market To Cave In; Nifty Should Hold 8,000: CK Narayan
But if 8,000 is broken convincingly, Narayan said, then it could fall 150-200 points.
While the NSE Nifty 50 Index has fallen below the psychologically important 8,000 mark, it remains a substantial support level for the index, CK Narayan of Growth Avenues Asset Advisors said.
“The positions (at Nifty December 8,000 put) have been created at decent premiums and I don’t believe these will be shaken. So, I do not think the 8,000 level is going to be broken in any significant manner,” Narayan told BloombergQuint by phone.
But if 8,000 is broken convincingly, Narayan expects the benchmark index to fall another 150-200 points.
“There was put concentration addition at 7,800 with 5-6 lakh shares added there. Maybe some of the traders in the market are making room for a decline. Whether that happens or not, we need to see, because right now I do not see any particular reason why the market should cave in,” he said.
Narayan expects the Nifty to consolidate at current levels for a little while longer.
“For spring back, we need some news or an event, both of which are currently absent. Right now, there are lots of troubles going around, so there is very low possibility that we will spring back even if we have reached the level of support, therefore, consolidation is the only way to go,” he added.