Indian equity benchmarks succumbed sank below the flatline in the last hour of Wednesday's session, as newsflow on the Russia-Ukraine conflict did little to restore investors' appetite for risk in a big way.
Analysts expect volatility to persist amid geopolitical tensions and ahead of the expiry of monthly derivatives contracts due on Thursday.
What do the charts suggest for Dalal Street now?
The Nifty50 has formed a triangular pattern on the daily chart and appears to be consolidating within the pattern, according to Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas.
"The lower end of the pattern is at 16,800 and the upper near 17,300. It is expected to witness further consolidation in this range, after which, it can resume the larger uptrend," he said.
Russia-Ukraine effect
Global markets are swaying on newsflow on the Russia-Ukraine conflict, making it a nightmare for momentum traders, Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel One, told CNBCTV18.com.
"One can keep a close watch on crucial support at 17,000-16,800 levels, and a cluster of resistance is visible in the 17,200-17,350-17,500 band... Let’s see how things unfold and probably we have to see off the February F&O series with this ambiguity only," he said.
Here are key things to know about the market before the February 24 session:
SGX Nifty
At 7:42 am on Thursday, Singapore Exchange (SGX) Nifty futures -- an early indicator of the Nifty index -- were down 251.5 points or 1.5 percent at 16,844.5, suggesting a gap-down opening ahead on Dalal Street.
Global markets
Equities in other Asian markets started the day with deep losses after Ukrainian President Volodymyr Zelenskyy said a "major war in Europe" could be started by Russia soon. MSCI's broadest index was down 1.2 percent at the last count.
Japan's Nikkei 225 was down 1.1 percent, China's Shanghai Composite 0.1 percent and Hong Kong's Hang Seng 1.4 percent. South Korea's KOSPI was down 1.8 percent and Singapore's Straits Times 1.6 percent.
S&P 500 futures were down half a percent.
On Wednesday, the S&P 500 fell 1.8 percent, the Dow Jones 1.4 percent and the technology stocks-heavy Nasdaq Composite 2.6 percent, as Ukraine declared a state of emergency.
What to expect on Dalal Street
The Indian market is gradually drifting lower amid excessive intraday volatility, mirroring global peers, while a mixed sectoral trend is adding to participants’ worries, according to Ajit Mishra, VP-Research, Religare Broking.
He believes it is prudent to restrict positions at the current juncture and wait for directional clarity.
Ruchit Jain, Lead Research at 5paisa.com, is of the view that only a breakout beyond the 16,800-17,400 range will bring more clarity on the next directional move.
Levels to watch out for
Mohit Nigam, Head-PMS at Hem Securities, has identified the following levels:
| Index | Resistance | Support |
| Nifty50 | 17,300 | 16,850 |
| Nifty Bank | 37,600 | 36,900 |
FII/DII activity
Foreign institutional investors (FIIs) net sold Indian equities worth Rs
3,417.2 crore on Wednesday, according to provisional exchange data. However, domestic institutional investors (DIIs) made net purchases of Rs 3,024.4 crore.
Call/put open interest
Exchange data shows the maximum call open interest is accumulated at the strike price of 17,500, with 1.9 lakh contracts, followed by 18,000, with 1.8 lakh contracts. On the other hand, the maximum put open interest is at 16,500, with 1.8 lakh contracts, and 17,000, with 1.2 lakh.
This suggests the Nifty has a major hurdle to take out at 17,500, followed by more resistance at 18,000, and meaningful support before 16,500 can be expected at 17,000.
Long build-up
Here are five stocks that saw an increase in open interest as well as price, suggesting a build-up of long positions:
| Symbol | Current OI | CMP | Price change (%) | OI change (%) |
| PIIND | 9,72,250 | 2,520 | 1.33% | 48.24% |
| ASIANPAINT | 15,33,150 | 3,248 | 0.78% | 45.12% |
| SBICARD | 22,09,500 | 800.1 | 0.99% | 37.86% |
| CROMPTON | 14,00,300 | 409.4 | 7.75% | 36.29% |
| TRENT | 12,05,675 | 1,052.20 | 0.61% | 30.25% |
Long unwinding
| Symbol | Current OI | CMP | Price change (%) | OI change (%) |
| LALPATHLAB | 4,04,375 | 2,659.45 | -0.38% | -34.00% |
| VOLTAS | 16,15,500 | 1,233.20 | -0.47% | -27.76% |
| INDIAMART | 2,60,550 | 4,773 | -0.20% | -20.98% |
| COROMANDEL | 3,39,375 | 787.15 | -0.42% | -20.07% |
| HONAUT | 5,025 | 40,412.55 | -0.92% | -17.61% |
(Decrease in open interest as well as price)
Short-covering
| Symbol | Current OI | CMP | Price change (%) | OI change (%) |
| CHAMBLFERT | 13,68,000 | 381.45 | 3.67% | -27.63% |
| MRF | 22,710 | 66,082.60 | 0.70% | -25.54% |
| IRCTC | 43,36,500 | 813.05 | 2.91% | -24.17% |
| HAL | 10,59,250 | 1,308 | 1.94% | -23.90% |
| LTTS | 3,04,000 | 4,437.95 | 0.05% | -23.22% |
(Increase in price and decrease in open interest)
Short build-up
| Symbol | Current OI | CMP | Price change (%) | OI change (%) |
| IDEA | 28,72,80,000 | 10.7 | -2.28% | 40.35% |
| NESTLEIND | 1,46,450 | 17,918 | -0.89% | 32.40% |
| BAJAJ-AUTO | 7,92,250 | 3,573.10 | -0.71% | 29.28% |
| HAVELLS | 17,68,500 | 1,201.05 | -0.01% | 27.59% |
| TVSMOTOR | 47,55,800 | 651.2 | -1.80% | 27.26% |
(Increase in open interest and decrease in price)
52-week highs
No stock in the BSE 500 basket managed to hit a 52-week high.
52-week lows
On the other hand, 11 stocks on the bourse's broadest index hit 52-week troughs, including Dilip Buildcon, V-Guard, Castrol, DCB Bank, Star Cement, Indostar Capital and Jubilant Pharmova.
Fear gauge
NSE's India VIX index -- known in market parlance as a barometre of fear -- cooled off eight percent to settle at 24.5 on Wednesday, easing from a one-year closing high scaled the previous day.
(Edited by : Abhishek Jha)
First Published: Feb 23, 2022 7:48 PM IST
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