Indian equity benchmarks failed to stay in the green in a volatile session on Thursday, amid caution among investors globally as the West planned more sanctions on Russia over Ukraine. Financial and auto stocks pulled the headline indices lower, though gains in oil & gas, IT, metal and pharma shares limited the downside.
What do the charts suggest for Dalal Street now?
The Nifty50 has formed a long positive candle at the lows on the daily chart with a minor upper shadow, suggesting broader range movement around 17,100-17,400 levels, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.
He sees the possibility of a bounce in the 50-scrip index in the coming sessions.
A make-or-break level
The index is finding it difficult to extend the Fibonacci retracement beyond 61.8 percent of the January-March decline, which is near 17,330, said Gaurav Ratnaparkhi, Head of Technical Research at Sharekhan by BNP Paribas. "On the downside, the junction of the 40-day exponential moving average and the 200-day moving average near 17000 is offering support. Structurally, the Nifty is expected to witness sideways action near these parameters before starting the next leg up," he said.
Ratnaparkhi continues to see dips towards 17,000 as buying opportunities for short-term traders.
Here are key things to know about the market before the March 25 session:
SGX Nifty
At 7:54 am on Friday, Singapore Exchange (SGX) Nifty futures -- an early indicator of the Nifty50 index -- were up 78 points or 0.5 percent at 17,300, having risen as much as 91 points earlier in the day.
Global markets
Equities in other parts of Asia were mixed in choppy trade amid a hawkish Fed, shifts in Chinese economic policy and ongoing ructions in commodity markets due to the Ukraine war. MSCI's broadest index of Asia Pacific shares outside Japan was down 0.2 percent in early hours.
Japan's Nikkei 225 was down 0.2 percent and Hong Kong's Hang Seng 0.4 percent. China's Shanghai Composite was up 0.1 percent, Singapore's Straits Times 0.6 percent and South Korea's KOSPI flat.
S&P 500 futures were up 0.1 percent. On Thursday, main Wall Street indices jumped backed by gains in chip-makers and growth stocks. The S&P 500 rose 1.4 percent percent, the Dow Jones one percent and the technology stocks-heavy Nasdaq Composite 1.9 percent.
What to expect on Dalal Street
HDFC Securities' Shetti believes the broader uptrend for the Nifty remains intact. Any decline from important resistance around 16,800-17,000 levels could find strong support at 17,000-16,900, he said.
He sees the possibility of the index advancing towards 17,400-17,500 in the near term.
Kotak Securities Head of Equity Research (Retail) Shrikant Chouhan mentioned signs of a continuation of rangebound activity in the near term. The bulls can find an immediate hurdle at 17,325, below which, a correction wave could continue up to 17,100-17,060, else the index can go to 17,325, he said.
To contrarian traders: Chouhan suggests taking a long bet near 17,060 with a strict stop loss at 17,030.
Levels to watch out for
Sachin Gupta, AVP-Research at Choice Broking, pointed out the following levels:
| Index | Support | Resistance |
| Nifty50 | 17,000 | 17,470 |
| Nifty Bank | 35,000 | 36,300 |
The Nifty50 is below its five- and 100-day moving averages. Here's what other simple MAs look like:
| Period (No. of days) | Simple moving average | Signal |
| 5 | 17,237.7 | Bearish |
| 10 | 16,992.4 | Bullish |
| 20 | 16,712.9 | Bullish |
| 50 | 17,210.2 | Bullish |
| 100 | 17,344.8 | Bearish |
| 200 | 17,029.3 | Bullish |
FII/DII activity
Provisional exchange data shows foreign institutional investors (FIIs) net sold Indian shares worth Rs 1,740.7 crore on Thursday. However, domestic institutional investors (DIIs) made net purchases of Rs 2,091.1 crore.
Call/put open interest
The maximum call open interest is accumulated at the strike price of 17,500, with 1.2 lakh contracts, and the next highest at 17,600 and 18,000, with 1.1 lakh each, according to exchange data. The maximum put open interest is at 17,200, with 1.2 lakh contracts, and the next highest at 16,800, with about 94,500 contracts.
This suggests the index has immediate resistance at 17,500 followed by 17,600, and immediate support comes in at 17,200 followed by a major cushion at 16,800.
Long build-up
Here are five stocks that saw an increase in open interest as well as price:
| Symbol | Current OI | CMP | Price change | OI change |
| PERSISTENT | 2,86,800 | 4,665 | 3.67% | 14.91% |
| LTTS | 5,31,000 | 5,053 | 2.73% | 14.12% |
| DRREDDY | 26,67,750 | 4,326.30 | 4.79% | 13.34% |
| NTPC | 4,40,55,300 | 135.45 | 1.08% | 8.73% |
| IDFC | 7,65,50,000 | 64.5 | 6.52% | 7.24% |
Long unwinding
| Symbol | Current OI | CMP | Price change | OI change |
| ESCORTS | 19,92,650 | 1,728 | -0.25% | -3.84% |
| BALRAMCHIN | 53,21,600 | 491.45 | -0.58% | -2.19% |
| HDFCAMC | 23,89,200 | 2,176.35 | -0.81% | -2.00% |
| BALKRISIND | 11,64,000 | 2,067.70 | -0.16% | -1.98% |
| RAMCOCEM | 29,12,950 | 728.25 | -0.35% | -1.96% |
(Decrease in open interest as well as price)
Short-covering
| Symbol | Current OI | CMP | Price change | OI change |
| HONAUT | 8,655 | 38,892.95 | 0.07% | -5.89% |
| GNFC | 26,96,200 | 800 | 2.76% | -5.79% |
| SAIL | 12,16,85,500 | 101.65 | 0.84% | -4.82% |
| UBL | 11,95,250 | 1,455 | 1.13% | -3.69% |
| GAIL | 3,25,92,300 | 147.45 | 2.36% | -3.29% |
(Increase in price and decrease in open interest)
Short build-up
| Symbol | Current OI | CMP | Price change | OI change |
| KOTAKBANK | 1,22,37,200 | 1,721.25 | -2.72% | 24.53% |
| NAVINFLUOR | 3,36,375 | 3,980.70 | -0.52% | 13.24% |
| IDFCFIRSTB | 16,47,68,400 | 40.05 | -1.96% | 11.03% |
| HAL | 19,00,950 | 1,406 | -0.39% | 10.67% |
| CUMMINSIND | 18,93,600 | 1,086.90 | -0.03% | 6.91% |
(Increase in open interest and decrease in price)
52-week highs
A total of nine stocks on the BSE 500 hit 52-week highs, including Vedanta, Hindalco, Cummins, JSPL, Adani Total, Cholamandalam Investment and Linde.
52-week lows
Three stocks hit 52-week lows: Aarti Drugs, Max Financial and Procter & Gamble Health.
Fear gauge
The India VIX -- also known as the fear index -- eased 3.3 percent to settle at 23.9 for the day, having risen to as high as 25.5 during the session. Last month, Russia's move to invade Ukraine had pushed the gauge to a 20-month high.
First Published: Mar 24, 2022 8:14 PM IST
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