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Are there more downsides for Nifty50 to come?  What the charts suggest ahead of Monday’s market session

Indian stock indices closed a two-day winning run on Friday amid selling pressure on financial, oil and gas and consumer stocks. Bank Nifty fell 1.2%, its biggest drop in more than a week.

What do the charts suggest for Dalal Street now?

The Nifty50 formed a long bullish candle on the daily chart, completely engulfing the long bullish candle from the previous session., according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

“The candles from the last two sessions indicate the formation of a dark cloud cover-like pattern. Technically, such patterns are forming at the highs and the area is considered a downward reversal pattern,” he said. he declares. The recent rebound from last session appears to have ended and the market has moved lower from highs, Shetti added.

No meaning backwards

In a bearish signal, the Nifty failed to hold above the 17,400-17,500, said Manish Hathiramani, index owner and technical analyst at Deen Dayal Investments. “Unless the index breaks the 17,400-17,500 patch on a closing basis, we won’t really see a significant bullish rally,” he said.

Hathiramani believes the market is likely to return to a downtrend if the index crosses the 17,100 mark.

Here are the key things to know about the market ahead of Monday’s session:

Global markets

All three major Wall Street indices fell on Friday, the tech-rich Nasdaq Composite falling 1.9%, investors betting a strong jobs report would not slow the withdrawal of Federal Reserve support as they grappled with the uncertainty surrounding the Omicron variant of the coronavirus. Earlier today, European markets also fell, with the pan-European Stoxx 600 index falling 0.6%.

What to expect on Dalal Street

According to Sameet Chavan, chief technical and derivatives analyst at Angel One, it continues to be a bullish sell market. “This view will remain intact as long as the Nifty does not rise above 17,900, which is the confluence of two key trend lines. Sooner or later we expect the recent low around 16,800 to be crossed, but this is will occur immediately or after some more consolidation in the range of 16,800 to 17,500 levels, ”he said.

Traders are advised to continue with a specific approach to stocks, said Chavan, who expects immediate hurdles at levels of 17,350-17,500-17,600.

Shetti of HDFC Securities believes the short-term trend for Nifty continues to be downward, with the recent pullback rally completed. “There is the possibility of further weakness up to 16,800 levels this week, with immediate resistance at 17,300-17,350 levels, “he said.

Key levels to watch

clever50: According to Choice Broking’s Palak Kothari, the index has support at 17,000 and facing resistance at 17,500.

Smart bank: For the banking index, support is expected at 35,300 and resistance at 37,000.

On Friday, foreign institutional investors (FII) unloaded Indian stocks worth Rs 3,356.2 crore. However, domestic institutional investors made net purchases of Rs 1,648.8 crore, according to provisional exchange data.

The maximum interest for opening a call is placed at the strike price of 18,000 with 1.2 lakh contracts, and the next highest to 17,500 with contracts of 1.1 lakh. The maximum open interest of the put is accumulated at 17,000 with 54,000 contracts, exchange data shows. This suggests an immediate hurdle at 17,500 followed by major resistance at 18,000, and support stands at 17,000.

Here are five stocks that saw an increase in open interest as well as price, suggesting an accumulation of long positions:

symbol Current OI CMP Price change (%) Change of IO (%)
DEPTH 6000 2 326.50 3.86% 380.00%
OBEROIRLTY 2,100 866.15 2.30% 200.00%
HINDPETRO 18,900 301.85 1.55% 133.33%
VEDL 96,100 339.15 0.34% 106.67%
GSPL 79,900 314.5 2.91% 104.35%

Long process

symbol Current OI CMP Price change (%) Change of IO (%)
ELECTRICAL NETWORK 1 86 17 503 204.7 -2.38% -15.18%
IBULHSGFIN 4,01,07,800 256 -0.37% -6.79%
L & TFH 6,04,60,100 79.15 -0.25% -4.19%
INFY 3,57,48,600 1745.30 -0.29% -3.49%
PFC 4,43,92,000 121.5 -0.12% -2.77%

Short cover

symbol Current OI CMP Price change (%) Change of IO (%)
IDEA 83,06,90,000 2:45 p.m. 12.02% -13.58%
CIO 3 52 23 500 122.7 12.69% -9.55%
COALIND 5.00,55,600 160.4 1.57% -3.75%
TATAMOTORS 8,60,44,350 481.5 0.44% -1.81%
JINDALSTEL 359.9 0.16% -1.02%

Short construction

symbol Current OI CMP Price change (%) Change of IO (%)
GNP 38.75 -0.39% 286.54%
IEX 3,52,35,000 253.55 -65.34% 202.74%
BANK ICICI 11,61,43,500 720.1 -0.79% 3.71%
TIC 23,49,63,200 222.3 -1.88% 1.79%
BHARTIARTL 6,64,43,780 720.6 -1.89% 2.76%

(Increase in open interest and decrease in price)

Tech Mahindra, Bajaj Holding, Vodafone Idea, Power Grid, and Torrent Power were among nine stocks in the BSE 500 universe that hit record highs in 52 weeks.

52 week trough

Gillette was the only stock in the broadest index to hit the bottom.

NSE’s India VIX index – which measures expectations of short-term volatility – fell 2% to 18.5 on Friday.


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