Derivatives strategy by SAMCO Securities

by Dhupesh Dhameja, Derivatives Research Analyst, SAMCO Securities

🕗 Last Update: 26 March 2026, 7.00 AM

Short Covering Pushes Nifty Higher; 23,500 Next Key Hurdle

Nifty witnessed a strong follow-through recovery and closed at 23,306.45, up 394.05 points (+1.72%), indicating continued short covering after the recent sharp decline. The index sustained above the psychological 23,000 mark throughout the session, reflecting improving sentiment.

Technically, the index has reclaimed its immediate resistance zone of 23,000–23,100, which now turns into an important support area. As long as the index holds above this zone, the pullback may extend toward 23,600–23,800, while failure to hold 23,000 could drag the index back toward 22,700–22,500.

Momentum indicators have improved from oversold territory, with RSI reclaiming above 40, reflecting improving sentiment after prolonged weakness. On the hourly chart, the index has moved above its short-term averages, supporting near-term strength, though the broader trend remains cautious as the index still trades below the falling 10-DEMA on the daily chart.

From a derivatives perspective, PCR near 1.25 indicates a positive undertone with aggressive put writing. Notably, put writers are building positions at 23,000, establishing it as a strong base, while call writers are active near 23,500–24,000, capping the upside. This positioning suggests a near-term range of 23,000–23,500.

Going ahead, sustained strength above 23,400–23,500 could trigger extended short covering toward 23,800–24,000, while rejection near higher levels may lead to consolidation. As long as the index holds above 23,000, a buy-on-dips strategy may remain favourable, whereas a break below it could revive selling pressure.

Nifty Bank’s Range Shifts Higher; 53,000–55,000 in Focus

Nifty Bank extended its recovery and closed at 53,708.10, up 1,102.45 points (+2.10%), indicating continued short covering after the recent sharp decline. The index sustained above the 53,500 zone but is facing supply near 54,000–54,200, where the falling short-term averages and previous breakdown zone are placed.

Technically, the index has reclaimed 53,000–53,200, which now acts as an immediate support area. Holding above this region may extend the pullback toward 54,800–55,000, while failure to sustain above 53,000 could again drag the index toward 52,200–51,900.

Momentum indicators are stabilizing from oversold territory, with RSI still unable to reclaim 40, reflecting that the recovery is largely short-covering driven and broader sentiment remains cautious. On the hourly chart, the index is attempting to form higher lows, indicating gradual improvement, though the broader structure still reflects a sell-on-rise trend below key supply zones.

From a derivatives perspective, PCR near 0.86 indicates a cautious undertone. Notably, call writers are active around 54,000 and 54,500, restricting the upside, while put writers are gradually shifting toward 53,000, marking it as a make-or-break support. This positioning suggests a range-bound setup between 53,000–55,000 in the near term.

Going ahead, sustained move above 54,200 could trigger further short covering toward 54,800–55,000, while rejection near resistance may invite fresh selling pressure. Until the index reclaims 55,000, sell-on-rise strategy may continue, with volatility expected to remain elevated.

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