Investors should remain cautious as a close below 10,300 could signal that bears will take over.
The Nifty which started on a muted note extended its fall towards the end of the trading session on Thursday to make a bearish candle on the daily charts. The Nifty closed 0.3 percent lower for the week ended March 1.
The Nifty formed a bearish candle on the daily charts while on the weekly charts it formed a ‘Shooting Star’ kind of pattern which should weigh on markets in the coming week.
A 'Shooting Star' pattern is formed when the index trades well above its opening level but witnesses selling pressure at higher levels as traders start booking profits. This pattern is usually formed in an uptrend and is treated as a reversal pattern.
Investors should remain cautious as a close below 10,300 could signal that bears will take over control. However, if the index starts to trade higher, the next important levels to watch is 10,630, suggest experts.
The Nifty index continued its weakness for the third consecutive session and corrected towards 10,450 zones. The index has been making lower high and lower lows from the last two trading sessions and sustained selling is seen at every small bounce back move.
The Nifty50 closed just above its 100-days moving average placed at 10,442 but below its 5-DEMA, 50-DEMA, and 13-DEMA. The trend for the coming week remain muted and as long as Nifty trades below 10,630 some more consolidation cannot be ruled out.
“The Nifty50 registered a bearish candle with a long upper shadow suggesting selling pressure at day’s high. However, on the weekly charts it appears to be a Shooting Star kind of formation which should have bearish connotations for the next week if prices settle below 10,447 levels in Monday’s session,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.
“This kind of price action in Friday’s session can be due to long week end as traders will not be comfortable to carry forward the positions especially in volatile times. Still, the larger move appears to be that of a range bound and consolidation in nature in the larger band of 10,630 – 10,300 levels,” he said.
Mohammad further added that support can be expected around 10,420 levels where 100 day EMA value is placed. “If this level is broken then correction shall get extended up to 10300 levels on the downside. Contrary to this for a sustainable upmove, a close above 10630 is required,” he said.
India VIX moved up by 1.97 percent at 14.07. On the options front, maximum Put open interest is placed at 10,400 followed by 10,300 strikes while maximum Call open interest is placed at 10,800 and 10,700 strikes.
Significant Call writing at strikes 10,800, 10,700, 10,500 and 10,600 which is restricting its upside while Put unwinding is seen at immediate strikes which is giving the scope for further declines.
We have collated the top fifteen data points to help you spot profitable trade:
Key Support & Resistance Level for Nifty:
The Nifty closed at 10,458.3. According to Pivot charts, the key support level is placed at 10,428.5, followed by 10,398.7. If the index starts to move higher, key resistance levels to watch out are 10,506.8 and 10,555.3.
Nifty Bank:
The Nifty Bank closed at 24,902.6. Important Pivot level, which will act as crucial support for the index, is placed at 24,762.63, followed by 24,622.67. On the upside, key resistance levels are placed at 25,134.33, followed by 25,366.07.
Call Options Data:
Maximum call open interest (OI) of 44.26 lakh contracts stands at strike price 10,800, which will act as a crucial resistance level for the index in the March series, followed by 10,700, which now holds 43.89 lakh contracts in open interest, and 11,000, which has accumulated 36.35 lakh contracts in OI.
Call writing was seen at a strike price of 10,800, which saw the addition of 15.53 lakh contracts, followed by 10,700, which added 7.07 lakh contracts and 10,500, which added 6.56 lakh contracts.
Call unwinding was seen at the strike price 10,900, which shed 6.86 lakh contracts.
Put Options Data:
Maximum put OI of 36.99 lakh contracts was seen at strike price 10,400, which will act as a crucial base for the index in March series; followed by 10,300, which now holds 34.90 lakh contracts and 10,000 which has now accumulated 32.42 lakh contracts in open interest.
Put Writing was seen at the strike price of 10,500, which saw addition of 2.68 lakh contracts, along with 10,300, which added 1.57 lakh contracts and 10,000, which added 1.17 lakh contracts.
Put unwinding was seen at the strike price of 10,600, which shed 2.39 lakh contracts, followed by 10,200, which shed 1.94 lakh contracts and 10,700, which shed 1.12 lakh contracts.
FII & DII Data:
Foreign institutional investors (FIIs) bought shares worth Rs 241.85 crore, while domestic institutional investors sold shares worth Rs 3.29 crore in the Indian equity market, as per provisional data available on the NSE.
Fund Flow Picture:
Stocks with high delivery percentage:
High delivery percentage suggests that investors are accepting the delivery of the stock, which means that investors are bullish on the stock.
32 stocks saw long build-up:
12 stocks saw short covering:
A decrease in open interest along with an increase in price mostly indicates short covering.
132 stocks saw short build-up:
An increase in open interest along with a decrease in price mostly indicates short positions being built up.
36 stocks saw long unwinding:
Long unwinding happens when there is a decrease in OI as well as in price.
Bulk Deals:
Punjab National Bank: Shaastra Securities traded 1.34 crore shares at Rs 101 apiece.
Innovative Tyres and Tubes: Johnson and Andrew Properties bought 1 lakh shares, while Shimth and Thomson Realty bought 1 lakh shares at Rs 48.05.
(For more bulk deals click here)
Analyst or Board Meet/Briefings:
Thomas Cook: The Board of Thomas Cook met on Thursday to decide on employee stock option scheme.
Mahindra Lifespaces: The Board will be meeting on April 27, 2018 to discuss the financial results.
Stocks in news:
PNB: Lingam Prabhakar appointed as executive director.
BDO India Appointed As Forensic Auditor For 5 Grp Cos Of Nirav Modi
ONGC: Appointment of Rajesh Kakkar on the Board of the firm.
TVS Motor: Total Sales rise 37% At 2.90 Lakh Units Vs 2.10 Lakh Units (YoY)
NMDC: Cuts Prices Of Lump Ore & Fines By Rs 100/Tn For March
5 stocks under ban period on NSE
Security in ban period for the next trade date under the F&O segment includes companies in which the security has crossed 95 percent of the market-wide position limit.
Securities which are banned for trading include names such as Fortis, HDIL, IDBI and Oriental Bank of Commerce.
