Anuj's Radar: Today’s trade is all about 18,000 call writers; will they be forced to cover

Traders will be on their toes today as it is the expiry of the weekly options. That is undoubtedly the biggest trigger for today’s session. In the spotlight will be 18,000 call option writers, with open interest in this contract at 1.45 crore shares. The Nifty's 10 day exponential moving average (DEMA) is placed at 18,022, which means that the Nifty needs to cross 18,022 if the call writers are to cover their positions. Traders can sell the Nifty at 17,950-18,000 with a stop of 18,022. However, there is big resistance for the Nifty at the 20 DEMA of 18,125. On the downside, support remains at the December low of 17,774. The buy zone for the Nifty is at 17,800-17,850, with traders able to buy at that range with a stop of 17,774. In addition to these domestic factors, there are also important global cues to keep an eye on. The all-important US inflation data is set to be released later this evening, and Foreign Institutional Investors (FIIs) have been net sellers so far this month. East Asian markets are showing big outperformance, and most rallies in Indian shares have been driven by short covering. The Nifty has been repeatedly testing the 17,800 level, but the Bank Nifty showed some respite yesterday.Looking specifically at the Nifty outlook, the Bank Nifty protected December lows by 200 points. However, there is big resistance for Bank Nifty today at 42,400-42,500. Key levels to watch for the Bank Nifty include the 50 DEMA at 42,401, the 10 DEMA at 42,550, and the 20 DEMA at 42,733. On the global front, markets are going into inflation with long positions.The Nasdaq continues to lead US markets, having rallied 9% from January lows. The US 10-year yield is down to 3.54, and the dollar is at 102.8. Indian IT stocks have shown bottoming signs, while China and metals remain an unbroken theme. Despite these global cues, the Indian market is not falling.