Indian equity benchmarks reversed initial gains to finish lower for a third straight day on Wednesday. Investors awaited more of corporate earnings from India Inc for domestic cues, after HCL Tech's quarterly margin missed Street estimates.
What do the charts suggest for Dalal Street now?
The Nifty50 has formed a long negative candle on the daily chart overlapping the previous negative candle, reflecting a lack of strength in the market to sustain the highs, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.
The short-term trend of the market remains weak, he said.
More pain on the cards
The 50-scrip index finished below its 50-day simple moving average after long, Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities, pointed out.
| Period (No. of sessions) | Simple moving average | |
| Nifty50 | Nifty Bank | |
| 5 | 16,123.5 | 34,994.1 |
| 10 | 15,959.5 | 34,296.2 |
| 20 | 15,764.1 | 33,729.9 |
| 50 | 16,063.4 | 34,247.9 |
| 100 | 16,583.3 | 35,246.7 |
| 200 | 17,108.5 | 36,509.8 |
He is of the view that a fresh pullback rally is possible only after the Nifty crosses 16,000, which could go all the way till 16,100-16,150 levels.
On the other hand, a correction wave is likely to continue up to 15,900-15,850 levels if it trades below the 50-day average or 16,000, he said.
Here are key things to know about the market ahead of the July 14 session:
SGX Nifty
Singapore Exchange (SGX) Nifty futures — an early indicator of the Nifty index — fell as much as 74.5 points or 0.5 percent to 15,898 ahead of the opening bell on Dalal Street on Thursday.
Global markets
Equities in other Asian markets were largely mixed following a weak session on Wall Street overnight, after data showed inflation in the world's largest economy stayed at a more than 40-year high — fuelling the fear that the Fed may continue with steep rate hikes. MSCI's broadest index of Asia Pacific shares outside Japan was flat at the last count.
Japan's Nikkei 225 was up 0.7 percent, but China's Shanghai Composite down 0.1 percent and Hong Kong's Hang Seng flat.
S&P 500 futures were down 0.2 percent. On Wednesday, the S&P 500 fell 0.5 percent, the Dow Jones 0.7 percent and the Nasdaq Composite 0.2 percent.
What to expect on Dalal Street
HDFC Securities' Shetti believes a decisive move further below key lower support at 16,000 levels could lead to next support at 15,700.
A sustainable upside could resume above 16,150, he said.
Important levels to track
Mohit Nigam, Head-PMS at Hem Securities, has identified the following levels to watch out for:
| Index | Support | Resistance |
| Nifty50 | 15,800 | 16,200 |
| Nifty Bank | 34,500 | 35,500 |
FII/DII activity
Call/put open interest
The maximum call open interest is accumulated at the strike price of 16,500, with 2.2 lakh contracts, and the next highest at 16,300, with 2.1 lakh, according to exchange data. The maximum put open interest is at 15,500, with 1.2 lakh contracts, and 15,800, with 1.1 lakh contracts.
This suggests a tough hurdle at 16,300 and immediate support at 15,800 mark.
Long build-up
Here are five stocks that saw an increase in open interest as well as price:
| Stock | Current OI | CMP | Price change | OI change |
| SYNGENE | 919,000 | 593.95 | 3.67% | 16.97% |
| MINDTREE | 3,020,000 | 2,919 | 2% | 13.99% |
| COFORGE | 452,850 | 3,493.05 | 0.05% | 13.91% |
| DABUR | 9,115,000 | 545.15 | 0.48% | 11.96% |
| ULTRACEMCO | 1,814,200 | 5,804.50 | 0.88% | 11.11% |
Long unwinding
| Stock | Current OI | CMP | Price change | OI change |
| COROMANDEL | 1,404,200 | 975 | -0.43% | -4.69% |
| EXIDEIND | 20,840,400 | 150.8 | -0.59% | -2.30% |
| NBCC | 18,360,000 | 31.15 | -0.95% | -0.98% |
| M&MFIN | 24,104,000 | 199.55 | -0.05% | -0.66% |
| CUMMINSIND | 2,012,400 | 1,082.50 | -0.72% | -0.60% |
(Decrease in open interest as well as price)
Short covering
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| IDEA | 574,070,000 | 8.85 | 1.14% | -0.40% |
(Increase in price and decrease in open interest)
Short build-up
| Stock | Current OI | CMP | Price change | OI change |
| INDUSINDBK | 16,579,800 | 819.6 | -3.23% | 21.98% |
| HCLTECH | 16,615,900 | 913.05 | -0.47% | 10.18% |
| HAL | 1,710,475 | 1,730.05 | -0.98% | 8.30% |
| LALPATHLAB | 1,143,750 | 2,012.95 | -3.08% | 7.17% |
| GAIL | 24,076,700 | 137.45 | -1.04% | 6.54% |
(Decrease in price and increase in open interest)
52-week highs
Three stocks on the BSE 500 — the broadest index on the bourse — touched the milestone: Gujarat Fluorochemicals, Varun Beverages and Adani Total Gas.
52-week lows
On the other hand, two stocks in the 500-scrip basket hit 52-week lows: HCL Tech and Gland Pharma.
First Published: Jul 13, 2022 7:12 PM IST
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