Though experts suggest the Nifty may have bottomed out near 10,040, investors must tread with caution ahead of the US Fed policy outcome.
The Nifty started on a positive note Wednesday but failed to keep the momentum going. The index closed below its crucial 200-day exponential moving average (DEMA) for the second day in a row. It formed a small-bodied candle which closely resembles a ‘Spinning Top’ kind of indecisive pattern.
Spinning Top is often regarded as a neutral pattern which suggests indecisiveness on the part of both bulls as well as bears. It can be formed in an uptrend as well as in a downtrend.
The Nifty index opened gap up and negated its formation of lower highs - lower lows of the last four trading session. It came under selling pressure in afternoon trade and pulled the index below 200-DEMA placed around 10165, and 5-DEMA which was placed at 10,185.
Investors are advised to tread with caution ahead of the US Federal Reserve policy meeting. But, technically, there is a higher possibility the market has bottomed out near 10,040, suggest experts.
“The Nifty50 registered a Spinning Top kind of indecisive formation as it faced selling pressure after retracing 38.2% of its last leg of fall from the highs of 10478 levels. However, this intraday selling can be attributed to the nervousness ahead of the major global event in the for form Fed meeting,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.
“As more or less market appears to have factored in the outcome of the event it should ideally stabilisie and rally unless there are going to be some nasty surprises from the Fed which are beyond the anticipation of the market,” he said.
Mohammad further added there is a higher possibility of a bottom around 10040 levels and hence, post Fed outcome if the market stabilises then the rally should get extend up to the levels of 10380. “Contrary to this a decisive breach of 10130 levels on intraday basis may again drag down the indices towards critical support zone of 10040 – 9980 levels,” he said.
India VIX fell down by 3.22 percent at 15.10. A decline in volatility from the last two trading sessions is providing some comfort to the Bulls but needs to fall below 13.50-13 to process for a short-term reversal after the recent decline of around 1100 points.
We have collated the top 15 data points to help you spot profitable trades:
Key support and resistance level for Nifty
The Nifty closed at 10,155.2 on Wednesday. According to Pivot charts, the key support level is placed at 10,116.37, followed by 10,077.53. If the index starts moving upwards, key resistance levels to watch out are 10,210.67 and 10,266.13.
Nifty Bank
The Nifty Bank index closed at 24,255.6 on Wednesday. The important Pivot level, which will act as crucial support for the index, is placed at 24,156.27, followed by 24,056.93. On the upside, key resistance levels are placed at 24,407.37, followed by 24,559.13.
Call Options data
In terms of open interest, the 10,500 call option has seen the most call writing so far at 61.40 lakh contracts. This could act as a crucial resistance level for the index in the March series.
The second-highest buildup has taken place in the 10,400 Call option, which has seen 44.85 lakh contracts getting written so far. The 10,300 Call option has accumulated 44.22 lakh contracts.
During the session, Call writing was most seen at the strike price of 10,300, which saw an addition of 1.52 lakh contracts.
Call unwinding seen was seen at the strike price of 10,100, which shed 6.23 lakh contracts, followed by 10,400, which shed 3.81 lakh contracts and 10,700, which shed 3.78 lakh contracts.
Put Options data
Maximum open interest in put options was seen at a strike price of 10,000, in which 66.12 lakh contracts been added till date. This will act as a crucial base for the index in the March series.
The 10,100 put option comes next, having added 44.01 lakh contracts so far, and the 10,200 put option, which has now accumulated 36.83 lakh contracts.
During the session, put writing was seen the most at a strike price of 10,200, with 8.98 lakh contracts being added, followed by 9,800, which added 1.38 lakh contracts.
Put unwinding was seen at a strike price of 9,900, in which 3.06 lakh contracts were shed, followed by 10,400, in which 2.84 lakh contracts were shed. The 10,100 put option saw 2.07 lakh contracts getting shed.
FII & DII data:
Foreign institutional investors (FIIs) bought shares worth Rs 98.44 crore, while domestic institutional investors purchased shares worth Rs 197.78 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 delivery of the stock, which means that investors are bullish on it.
82 stocks saw long build-up:
19 stocks saw short covering:
A decrease in open interest along with an increase in price mostly indicates short covering.
93 stocks saw short build-up:
An increase in open interest along with a decrease in price mostly indicates build-up of short positions.
12 stocks saw long unwinding:
Long unwinding happens when there is a decrease in OI as well as in price.
Bulk Deals:
Agro Phos India Limited: Jinesh Matalia sold 2,22,000 shares at Rs 33.92 per share
Electrosteel Steels Ltd: SCIIL Steel Cast Iron Investments (Cyprus) Limited sold 175,53,013 shares at Rs 2.30 per share
Milton Industries Limited: Ilaben Bipinkumar Nadiya bought 3,00,000 shares at Rs 26.75 petr share
Sequent Scientific Ltd.: Agnus Capital LLP sold 39,67,440 shares at Rs 81.90 per share
(For more bulk deals click here)
Analyst or Board Meet/Briefings:
Capital First: The Board will be meeting to discuss private placements of bonds and debentures.
REC: The Board will be meeting to discuss its capital issue.
Zensar Tech: The company will be conducting a non-deal roadshow in Hong Kong and Singapore on March 27 and 28, 2018.
Shalimar: The company will be meeting to discuss a rights issue.
Stocks in news:
Mahindra Holidays: Allotted 1,15,000 shares of Rs 10 each under ESOP scheme.
Sun Pharma: Gets nod from US FDA for Psoriasis drug
Dena Bank: The bank has made annual interest payment of Rs 40 crore on its 10.20 percent Basel-III compliant AT-I bonds series III.
UltraTech: The firm’s MD says we were not told about potentially suspect transactions.
Jaiprakash Associates: The Supreme Court has asked the firm to deposit Rs 200 crore by May 10
Reliance Communications: The firm has received bondholders’ approval for asset monetization plan, according to a Mint report.
Lakshmi Vilas Bank: Fisdom has tied up with the company to offer NPS scheme online, Mint reported.
Arvind: Adient India and the company have formed joint venture to make automotive fabric in India, Hindu BusinessLine reported.
Godrej: Godrej Aerospace expands tie-up with Rolls-Royce, wins Rs 200-cr contract
Havells India: The firm has appointed Shashi Arora as CEO of Lloyd.
ISGEC Heavy Engineering declares interim dividend
Dilip Buildcon emerge L-1 bidder by NHAI for EPC project of Rs 677.07 crore
Seven stocks under ban period on NSE
Security in ban period for the next day's trade 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 HDIL, IDBI, IFCI, Jindal Steel, JP Associates, Reliance Communications, and SAIL.