Trade Setup for Thursday: Top 15 things to know before Opening Bell

The Nifty which opened with a gap up failed to hold onto the momentum and closed just above its crucial support level of 10,700 making a Bearish Belt Hold kind of pattern on the daily charts.

A ‘Bearish Belt Hold’ pattern is formed when the opening price becomes the highest point of the trading day (intraday high) and the index declines throughout the trading day making up for the large body. The candle will either have a small or no upper shadow and small lower shadow.

Formation of a Bearish Belt Hold pattern after a bullish candle does not augur well for the bulls, but as long as Nifty holds above 10,680-10,700 levels, the momentum should continue.

The index opened at 10,783.85 and rose marginally to 10,784.65 which made an insignificant upper shadow on the charts before bears took over. The index declined below 10,700 in intraday trade to hit an intraday low of 10,689.80 before closing the day 21 points lower at 10,718.05.

“The Nifty registered a Bearish Belt Hold kind of formation as it was under pressure from the word go. It can be a healthy pause in the ongoing uptrend as momentum readings on the short to medium term charts are stretched on the upside as the market has not witnessed any correction in the last 5 weeks,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in, told Moneycontrol.

“As of now, there is no major technical breakdowns which are visible on the lower time frame charts and hence Nifty may witness range bound move between 10,800 to 10,600 levels before witnessing a directional move in either of the sides,” he said.

Mohammad further added that on the downsides a strong support can be expected in the zone of 10,647 – 10,628 whereas short-term trend may once again favour bears only on a close below 10,600. Contrary to this, any strength beyond 10,784 shall take the indices towards 10,928 levels.

India VIX moved up by 3.88 percent at 12.84. On the options front, maximum Put open interest (OI) is placed at 10,500 followed by 10,600 strikes while maximum Call OI is placed at 11,000 followed by 10800 strikes. Fresh Put writing at 10500 and 10700 strikes while Call writing is seen at 11000 and 10800 strikes.

We have collated top 15 data points to help you spot profitable trade

Key support and resistance level for Nifty

The Nifty closed at 10,718.0 on Wednesday. According to Pivot charts, the key support level is placed at 10,676.97, followed by 10,635.93. If the index starts moving upwards, key resistance levels to watch out are 10,771.87 and 10,825.73.

Nifty Bank

The Nifty Bank index closed at 25,568.3. The important Pivot level, which will act as crucial support for the index, is placed at 25,472.8, followed by 25,377.3. On the upside, key resistance levels are placed at 25,690.3, followed by 25,812.3.

Call Options data

In terms of open interest, the 11,000, call option has seen the most call writing so far at 60.34 lakh contracts. This could act as a crucial resistance level for the index in the May series.

The second-highest buildup has taken place in the 10,800 call option, which has seen 34.24 lakh contracts getting added so far. The 10,900 call option has accumulated 27.66 lakh contracts.

Call writing was seen at the strike price of 11,000, which added 3.51 lakh contracts, followed by 10,800, which added 2.69 lakh contracts and 11,200, which added 2.56 lakh contracts.

Call unwinding was seen at the strike price of 10,600, which shed over 70 thousand contracts, followed by 11,100, which shed 44,700 contracts, and 10,700, which shed 38,475 contracts.

Put Options data

Maximum open interest in put options was seen at a strike price of 10,500, in which 45.69 lakh contracts been added till date. This could be a crucial resistance level for the index in May series.

The 10,600 put option comes next, having added 33.24 lakh contracts so far, and the 10,400 put option, which has now accumulated 32.11 lakh contracts.

Put writing was seen at the strike price of 10,500, which added 8.19 lakh contracts, followed by 10,700, which added 3.33 lakh contracts and 10,600, which added 1.40 lakh contracts.

Put unwinding was seen at the strike price of 10,300, which shed 1.42 lakh contracts, followed by 10,200, which shed 63,450 contracts.

FII & DII data:

Foreign institutional investors (FIIs) sold shares worth Rs 525.93 crore, while domestic institutional investors bought shares worth Rs 165.84 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.

21 stocks saw long buildup

16 stocks saw short covering:

A decrease in open interest along with an increase in price mostly indicates short covering.

110 stocks saw short build-up:

An increase in open interest along with a decrease in price mostly indicates build-up of short positions.

63 stocks saw long unwinding

Bulk Deals:

Ruchi Soya Inds Ltd.: Abhadevi Shahra sold 38,25,000 shares at Rs 13.89 per share

Equitas: Creation Investments Equitas Holdings LLC sold 2,424,812 shares at Rs 165 per share

(For more bulk deals, click here)

Analyst or Board Meet/Briefings:

Kajaria Ceramics: The company will be interacting with investors on May 10, 2018.

Coffee Day Enterprises: The company will be meeting analysts on May 17, 2018.

Varun Beverages: Investors and analysts will be meeting the company’s representatives on May 3, 2018.

Stocks in news:

Monsanto: The firm’s Board will be meeting on May 15, 2018 to discuss financial results and a dividend issue.

Axis Bank: The lender allotted 52,840 shares of Rs 2 each under the ESOP scheme.

InterGlobe Aviation: Q4 profit down 73% YoY on fuel price increase, foreign exchange impact

Adani Enterprises: Rajiv Nayar resigns as CFO & Addl Director w.e.f May 1

Siemens: March quarter net profit has risen 18 percent at Rs 219.7 crore.

Cadila: Zydus received final approval from US FDA for Bumetanide tablets.

National Fertilizers Q4 net profit down 23.9% at Rs 67.68 crore, revenue up 12.8% at Rs 2,095.73 crore

Siemens Q2 net profit up 18.2% at Rs 219.7 crore, revenue up 7.6% at Rs 3,283.4 crore

2 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.

For May 3, 2018 IRB Infra and PC Jeweller are present in this list.