Indian equity benchmarks finished a choppy session on Friday in the green, halting a four-day losing streak, amid strength in financial, FMCG and auto stocks though weakness in select IT and metal stocks played spoilsport. Investors awaited more of corporate earnings from India Inc for domestic cues.
Globally, dovish remarks by two Fed officials eased some of the concerns about steep hikes in COVID-era interest rates and shifted investor focus away from disappointing banking earnings in the US.
What do the charts suggest for Dalal Street now?
The Nifty50 has formed a small-body positive candle on the daily chart with a long lower shadow, and one can expect more upside ahead, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.
"The formation of a positive pattern at the key support level signals more upside for the market ahead. The next upside levels to be watched are around 16,250 with immediate support at 15,925," he said.
More upside on cards
"The global environment is still not conducive but our market is not willing to give up, continuing to attract some buyers at lower levels. The 15,850-15,950 zone has become sacrosanct this week and if global markets support, we may see the market inching northwards," Sameet Chavan, Chief Analyst-Technical and derivatives at Angel One, told CNBCTV18.com.
Broad-based buying can occur this week only once the 50-scrip index gets past immediate resistance at 16,150-16,250 levels, he said.
Here are key things to know about the market ahead of the July 18 session:
SGX Nifty
Singapore Exchange (SGX) Nifty futures — an early indicator of the Nifty index — gained as much as 183.5 points or 1.1 percent to 16,223.5 ahead of the opening bell on Dalal Street on Monday.
Global markets
Equities in other Asian markets clocked sharp gains tracking a strong session on Wall Street, though caution persisted over steep hikes in interest rates ahead of a widely expected increase in Europe. MSCI's broadest index of Asia Pacific shares outside Japan was up 0.5 percent at the last count.
Japan's Nikkei 225 was up 0.5 percent, China's Shanghai Composite 0.4 percent and Hong Kong's Hang Seng 0.6 percent.
S&P 500 futures were up 0.2 percent. On Friday, Wall Street indices bounced back around two percent each amid upbeat earnings, strong economic data and easing fears of a larger-than-expected interest rate hike by the Fed.
What to expect on Dalal Street
Angel One's Chavan suggests momentum traders to stay light on positions and, instead, identify apt themes remain a key for momentum traders. He is of the view that participation of banking and IT pockets is a must to lift the sentiment among traders.
"Traders can focus on cash segment counters as well, which are likely to provide better trading opportunities going ahead," he said.
Important levels to track
The Nifty50 is about six percent below its long-term simple moving average (SMA).
| Period (No. of sessions) | SMA | |
| Nifty50 | Nifty Bank | |
| 5 | 16,045.8 | 34,952.7 |
| 10 | 16,021.8 | 34,688.9 |
| 20 | 15,844.5 | 34,003.1 |
| 50 | 16,027 | 34,229.4 |
| 100 | 16,543.8 | 35,157.5 |
| 200 | 17,080.6 | 36,461.7 |
Mohit Nigam, Head-PMS at Hem Securities, has identified the following levels to watch out for:
| Index | Support | Resistance |
| Nifty50 | 15,800 | 16,600 |
| Nifty Bank | 34,000 | 35,500 |
FII/DII activity
Call/put open interest
The maximum call open interest is accumulated at the strike price of 16,600, with 94,000 contracts, and the next highest at 16,400, with more than 66,000, according to exchange data. The maximum put open interest is at 16,000, with 88,000 contracts, and 15,900, with nearly 82,000 contracts.
This suggests a tough hurdle at 16,400 and support at the 16,000 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 | 1,055,000 | 617.05 | 4.96% | 22.09% |
| DALBHARAT | 960,500 | 1,455.95 | 0.76% | 17.91% |
| WHIRLPOOL | 512,400 | 1,694.35 | 1.28% | 9.70% |
| FEDERALBNK | 70,710,000 | 97.2 | 1.41% | 9.38% |
| HEROMOTOCO | 3,599,100 | 2,776 | 0.35% | 7.06% |
Long unwinding
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| BANDHANBNK | 26,254,800 | 270.65 | -1.76% | -5.82% |
| DRREDDY | 1,883,875 | 4,537.25 | -0.49% | -3.68% |
| VEDL | 53,637,750 | 227.7 | -0.20% | -3.01% |
| INDUSINDBK | 18,286,200 | 819.2 | -0.28% | -2.50% |
| ONGC | 74,620,700 | 126.8 | -0.43% | -2.43% |
(Decrease in open interest as well as price)
Short covering
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| LTI | 1,660,950 | 3,989.95 | 2.79% | -13.45% |
| KOTAKBANK | 15,722,800 | 1,787 | 1% | -7.87% |
| HDFC | 26,702,700 | 2,218.90 | 2.25% | -6.81% |
| CHOLAFIN | 10,090,000 | 635.55 | 2.86% | -5.91% |
| BPCL | 14,160,600 | 312.95 | 1.84% | -5.20% |
(Increase in price and decrease in open interest)
Short build-up
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| SAIL | 98,352,000 | 68.35 | -2.57% | 10.70% |
| HAL | 1,849,175 | 1,732 | -0.26% | 10.53% |
| BSOFT | 3,879,200 | 310.7 | -1.63% | 7.84% |
| CANBK | 36,944,100 | 205.95 | -2.09% | 7.48% |
| ACC | 2,602,500 | 2,147 | -0.63% | 6.99% |
(Decrease in price and increase in open interest)
52-week highs
Three stocks in the BSE 500 universe — the broadest index on the bourse — reached the milestone: Adani Enterprises, Adani Transmission and Blue Dart Express
52-week lows
TCS, Wipro, HCL Tech, Birlasoft, Mphasis, NMDC and PB Fintech hit 52-week lows.
First Published: Jul 18, 2022 12:19 AM IST
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