Domestic markets traded volatile on Wednesday and closed with losses as bears overpowered bulls. S&P BSE Sensex ended 304 points or 0.53% lower at 57,684 while the broader NSE Nifty 50 shed 0.40% to settle at 17,245. India VIX, the volatility gauge, ended 2.8% higher at 24.75 levels. Ahead of the weekly futures & options expiry, SGX Nifty was down in the red, hinting at a gap-down start for indices. Global cues were weak with most indices trading in the red with losses. Investors, across the globe, have been gauging the sharp movement in commodity prices amid Russia’s invasion of Ukraine.
Global watch: On Wall Street, NASDAQ ended 1.32% lower, followed by Dow Jones and S&P 500. Asian markets were also languishing with Shanghai Composite, Hang Seng, Nikkei 225, TOPIX, KOSPI, and KOSDAQ all in the red.
Technical take: Nifty formed a long negative candle on the daily chart after opening higher, said Nagaraj Shetti, Technical Research Analyst, HDFC Securities while adding that this indicates strong resistance. “However, the pattern of the last four sessions signal formation of alternative candle pattern of positive and negative, which ideally indicates a broader range movement around 17400-17000 levels,” Shetti said.
Levels to watch out: “On intraday and daily charts, the Nifty is holding a higher bottom formation but at the same time it is consistently facing resistance near 17440,” said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities. “For the traders, the Nifty support has shifted to 17200 from 17000. We expect the level of 17350-17440 if the index succeeds to trade above 17200. On the flip side, dismissal of 17180 may intensify further weakness up to 17100-17040,” he added. On the other hand, Nagaraj Shetti sees 17100-17000 as strong support for the short-term and 17500 as the resistance.
FII and DII trades: Foreign Institutional Investors (FII) were net buyers of domestic stocks once again on Wednesday, pumping in money for the second day straight. FIIs bought equity worth Rs 481 crore. Domestic Institutional Investors (DII), were net sellers pulling out Rs 294 crore.
Call and Put OI: Call open interest (OI) for the March F&O series is at 18000 strike while Put OI is the maximum at 16000 strike. “Nifty futures saw long unwinding while Bank Nifty futures saw fresh short buildup,” said Rahul Sharma, Director & head – Research, JM Financial.
