As Nifty nears 16,800, the market may soon be gearing up for a pullback rally


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Trade setup for Thursday September 29th: We can expect a pullback from the 16,750 to 16,800 levels in the coming days, according to experts. Here’s what the technical charts suggest.

Benchmarks for Indian equities hit new two-month closing lows on Wednesday as the market continued to decline for the sixth consecutive session. Overall, nervousness persists among investors over fears of sharp rate hikes and their impact on economic growth.

Analysts are expecting volatility ahead of the expiration of monthly derivatives contracts expected by the end of Thursday’s session. Investors are awaiting the outcome of the RBI’s rate-setting panel deliberations scheduled for Friday.

What do the graphs suggest for Dalal Street?

The Nifty50 has formed a small negative candle on the daily chart with a long upper shadow, suggesting the creation of a wave or doji type pattern, according Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

“The overall market trend is still weak and there is no buy confirmation coming out of the dips,” he said.

More pain likely for those betting on the banking basket

“Nifty Bank’s slip below key support at 38,000 signals further near-term declines,” said Kunal Shah, senior technical analyst at LKP Securities.

He believes the banking index continues to be in a sell-up mode with multiple hurdles in the 38,500-39,000 area. “The next crucial support is placed at 36,000, which coincides with its moving average 200 days.”

Here are the key things to know about the market ahead of the September 29 session:

Wall Street indices rose on Wednesday after soothing comments from the Bank of England that it would enter the bond market to stem a damaging rise in borrowing costs, amid fears of contagion to the wider world. financial system. The S&P 500 and Dow Jones rose 0.9% each, and the Nasdaq Composite gained 0.8%.

European markets recouped initial losses led by blue-chip UK stocks. The Stoxx 600 was up 0.4% at last count.

What to expect on Dalal Street?

HDFC Securities’ Shetti expects the market to rebound from 16,750 to16,800 levels in the next 1-2 sessions, and immediate resistance at 17,000.

Major Moving Averages

The Nifty and Nifty Bank are around 4-5% below their long-term simple moving averages in a bearish sign.

Number of sessionsNifty50Clever bank
516,918.237,990.2
ten16,94238,092.4
2016,997.538,370.2
5017,322.439,565.9
10017,588.940,316.9
20017,611.439,887.2

Foreign institutional investors (FIIs) remained net sellers of Indian stocks for the sixth consecutive trading day on Wednesday, according to preliminary trading data.

The maximum call open interest is accrued at the strike price of 17,000, with 1.9 lakh contracts, and the next highest at 17,500, with 1.7 lakh, according to exchange data. On the other hand, the maximum open interest put is placed at strikes of 16,800, 16,500 and 16,000, with contracts of 1.1 lakh each.

This suggests strong resistance at 17,000 and strong support at 16,800 followed by 16,500.

Here are five stocks that have seen an increase in open interest as well as price:

StoreCurrent IOCPMPrice changeChange of IO
PAGEIND45,69050,062.800.70%32.86%
LALPATHLAB505 7502,685.301.18%32.53%
ASIAN PAINTING2,752,8003,5692.86%30.60%
HAVELS1,802,5001,3200.27%30.18%
DABUR3,885,0005650.61%28.80%

Long relaxation

StoreCurrent IOCPMPrice changeChange of IO
IPCALAB450 450892.5-1.48%-35.93%
COFORGE292,9503,421-1.53%-30.93%
FSL7,160,400101.65-0.93%-29.34%
NAV INFLUENCER282,6004,417.45-0.69%-26.99%
BAJAJFINSV3,279,0001,644-2.16%-26.99%

(Increase in price and decrease in open interest)

StoreCurrent IOCPMPrice changeChange of OI
IBULHSGFIN8,672,000113.90.49%-39.25%
ASTRAL440,8252,190.800.84%-33.13%
INTELLECT873,750542.050.95%-32.88%
DRREDDY623 6254,260.101.65%-23.13%
PERSISTENT330 4503,189.750.10%-22.79%

(Increase in price and decrease in open interest)

StoreCurrent IOCPMPrice changeChange of IO
TORNTPHARM683,5001,495.50-2.52%50.69%
MARUTI1,477,9008,699.75-0.81%41.23%
ATUL102,3758,754.30-1.78%34.95%
GODREJCP2,448,000881.35-0.21%32.07%
SIEMENS772 4752,699.50-0.93%28.05%

(Decrease in price and increase in open interest)

Three stocks in the BSE 500 universe – the stock market’s broadest index – broke through: Cipla, Asian Paints and Gujarat Fluorochemicals.

On the other hand, 17 stocks hit 52-week lows:

ALOKTEXTIOCOIL
DHANUKAJCHACPGHL
GLANDLICISHILPAMED
GRAPHITEMASTEKSONACOM
IEXMEDPLUSSYMPHONY
INDOCONATCOPHARM


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