Indian equity benchmarks managed to finish higher for a second straight day as Dalal Street returned to trade on Thursday after a day's holiday, though the bulls slowed down after a global market-driven rally in the previous session. A largely negative trend globally amid persistent worries about steep rate hikes and their impact on economic growth.
What do the charts suggest for Dalal Street?
The Nifty50 has formed a small negative candle on the daily chart with an upper shadow, reflecting sort of a breather after a bounce from strong support at 16,800, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.
One can expect some sideways move in the coming sessions with resistance around 17,450-17,500 levels, he said.
More upside on the cards for Nifty Bank
The Nifty Bank has sustained above its 50-day exponential moving average on the daily chart with momentum indicator RSI entering a bullish crossover, said Rupak De, Senior Technical Analyst at LKP Securities.
"Over the short term, the index may move towards 40,500. On the lower end, support is visible at 38,800," he pointed out.
Here are key things to know about the market ahead of the October 7 session:
SGX Nifty
On Friday, Singapore Exchange (SGX) Nifty futures — an early indicator of the Nifty index — were down 48 points or 0.3 percent at 17,268 at the last count, having declined as much as 62.5 points earlier in the day.
Global markets
Equities in other Asian markets were off to a negative start, with a weak handover overnight from Wall Street, amid fears that sharp rate hikes might fuel recession. MSCI's broadest index of Asia Pacific shares outside Japan was down 0.8 percent at the last count.
Japan's Nikkei 225 was down 0.6 percent and Hong Kong's Hang Seng down 0.9 percent. The China market remained shut for holidays.
S&P 500 futures were flat. On Thursday, the S&P 500 fell one percent, the Dow Jones 1.2 percent and the Nasdaq Composite 0.7 percent, as investors awaited a monthly nonfarm payrolls report due the next day for cues.
What to expect on Dalal Street?
HDFC Securities' Shetti sees the possibility of minor consolidation in the next 1-2 sessions around a key hurdle at 17,400-17,500 levels before a decisive breakout.
"Immediate support is placed at 17,220," he said.
Key moving averages
Thursday's rise brought brought the Nifty50 one percent within its long-term moving average, from 1.5 percent the previous day.
| Period (No. of sessions) | Simple moving average | |
| Nifty50 | Nifty Bank | |
| 5 | 17,355.3 | 39,379.2 |
| 10 | 17,349.2 | 39,331.9 |
| 20 | 17,230.8 | 38,998.8 |
| 50 | 17,064.7 | 38,471.6 |
| 100 | 17,275.9 | 39,338.2 |
| 200 | 17,520.2 | 39,816.4 |
FII/DII activity
Foreign institutional investors (FIIs) remained net purchasers of Indian shares for a second straight day on Tuesday after eight back-to-back sessions of selling, according to provisional exchange data.
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 (%) |
| INDIACEM | 14,668,200 | 276.65 | 5.67% | 22.08% |
| UBL | 956,800 | 1,737 | 2.05% | 13.75% |
| POLYCAB | 839,100 | 2,638.05 | 0.31% | 12.80% |
| BHEL | 108,444,000 | 64.15 | 2.80% | 11.39% |
| IBULHSGFIN | 36,376,000 | 132 | 5.35% | 10.92% |
Long unwinding
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| INDHOTEL | 23,552,832 | 343.5 | -0.43% | -0.58% |
| INDUSTOWER | 13,423,200 | 201.95 | -0.22% | -0.48% |
| IPCALAB | 1,248,000 | 922.5 | -1.44% | -0.42% |
| MRF | 53,470 | 82,582 | -0.08% | -0.28% |
| INDUSINDBK | 19,546,200 | 1,206.90 | -1.24% | -0.26% |
(Increase in price and decrease in open interest)
Short covering
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| CROMPTON | 4,836,000 | 399.1 | 0.91% | -4.62% |
| MOTHERSON | 66,946,500 | 76.5 | 5.59% | -3.25% |
| BHARATFORG | 7,091,000 | 764.85 | 7.64% | -2.95% |
| BEL | 84,348,600 | 104.85 | 2.34% | -2.20% |
| ABFRL | 7,839,000 | 337.55 | 0.73% | -1.43% |
(Increase in price and decrease in open interest)
Short build-up
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| CUB | 6,185,000 | 172 | -0.92% | 29.91% |
| AUBANK | 5,653,000 | 605.85 | -0.69% | 23.07% |
| GODREJCP | 6,126,000 | 856 | -4.85% | 16.19% |
| ULTRACEMCO | 1,897,600 | 6,292.90 | -0.69% | 14.35% |
| INDIGO | 4,005,900 | 1,823 | -2.07% | 9.92% |
(Decrease in price and increase in open interest)
First Published: Oct 6, 2022 9:01 PM IST
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