Indian equity benchmarks closed higher on Monday after losing almost three percent of their value in the past three back-to-back sessions, aided by gains in financial, FMCG and IT stocks though losses in metal shares played spoilsport.
All eyes globally are on key rate decisions by major central banks this week, with the Fed widely expected to announce a 75-bp hike in the COVID-era interest rates.
What do the charts suggest for Dalal Street?
The Nifty50 has formed a small positive candle on the daily chart with a minor lower shadow, as it is placed within a broader 17.500-18,000 range, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.
Any sustainable bounce in the 50-scrip index could be faced with hurdles around 17,750, 17,860 and 18,050 levels, he pointed out.
Sideways movement likely in banking index
"The Nifty Bank is likely to continue to consolidate in the 40,500-41,500 range ahead of the FOMC meeting this week," said Kunal Shah, Senior Technical Analyst at LKP Securities.
Traders should brace for volatility in the coming days and be prepared for both sides, he said.
Here are key things to know about the market ahead of the September 20 session:
SGX Nifty
On Tuesday, Singapore Exchange (SGX) Nifty futures — an early indicator of the Nifty index — gained as much as 144 points or 0.8 percent to 17,768, ahead of the opening bell on Dalal Street.
Global markets
Equities in other Asian markets began the day in the green, supported by a positive end to a choppy session on Wall Street overnight. MSCI's broadest index of Asia Pacific shares outside Japan was up 0.6 percent at the last count. Japan's Nikkei 225 was up 0.4 percent, as the market returned to trade after a long weekend, Hong Kong's Hang Seng was up 1.2 percent and China's Shanghai Composite up 0.5 percent.
S&P 500 futures edged 0.1 percent higher. On Monday, the S&P 500 finished 0.7 percent higher, the Dow Jones rose 0.6 percent and the Nasdaq Composite 0.8 percent.
What to expect on Dalal Street?
HDFC Securities' Shetti believes the Nifty50's short-term trend remains negative.
"Monday's bounce could be a reason for the bulls to make a comeback. A sustainable upmove could take the index towards 18,000 again, but any weakness below support at 17,450 could open the next downside towards the 17,100-17,000 band in the near term," he warned.
Key moving averages
The Nifty50 stands about half a percent above its long-term simple moving average.
| Period (No. of sessions) | SMA |
| 5 | 17,621.6 |
| 10 | 17,594 |
| 20 | 17,676.5 |
| 50 | 17,860.4 |
| 100 | 17,764.2 |
| 200 | 17,714.3 |
Shah of LKP sees key resistance for the Nifty Bank at 41,500 and support at 40,000.
FII/DII activity
Foreign institutional investors (FIIs) returned to net purchasing Indian shares on Monday following three straight days of selling.
In August, they made net purchases to the tune of Rs 22,025.8 crore — the first month of net inflows after 10 straight months of outflows, whereas domestic institutional investors (DIIs) net sold shares worth Rs 7,068.9 crore.
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Call/put open interest
The maximum call open interest is accumulated at the strike prices of 17,900 and 18,000, with 1.3 lakh contracts each, and the next highest at 17,800, with 1.1 lakh, according to exchange data. On the other hand, the maximum put open interest is at 17,500, with 1.2 lakh contracts, and at 16,500, with more than 99,000.
This suggests immediate resistance at 17,900 followed by the 18,000 hurdle, and immediate resistance at 17,500.
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 (%) |
| ESCORTS | 1,420,650 | 2,091 | 8.36% | 27.53% |
| MFSL | 2,029,950 | 852.5 | 3.49% | 10.34% |
| TVSMOTOR | 6,812,400 | 1,032.90 | 0.74% | 8.92% |
| JKCEMENT | 383,500 | 2,834.90 | 0.13% | 7.30% |
| ACC | 4,453,250 | 2,650.45 | 1.13% | 7.17% |
Long unwinding
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| PVR | 3,938,132 | 1,761 | -0.07% | -4.16% |
| TATACONSUM | 8,464,500 | 793.1 | -0.60% | -3.43% |
| LTI | 1,215,900 | 4,357.20 | -0.47% | -3.32% |
| GSPL | 5,087,500 | 239 | -2.69% | -3.00% |
| ICICIBANK | 84,372,750 | 903.6 | -0.96% | -2.85% |
(Increase in price and decrease in open interest)
Short covering
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| INDIACEM | 17,089,700 | 291.9 | 9.74% | -10.74% |
| AMBUJACEM | 70,203,600 | 564.05 | 8.68% | -5.35% |
| HAVELLS | 4,223,500 | 1,315.75 | 0.63% | -3.99% |
| EICHERMOT | 3,060,400 | 3,591 | 1.40% | -2.71% |
| LUPIN | 8,298,550 | 646.2 | 1.92% | -2.70% |
(Increase in price and decrease in open interest)
Short build-up
| Stock | Current OI | CMP | Price change (%) | OI change (%) |
| CANFINHOME | 1,992,900 | 589.75 | -7.40% | 62.13% |
| GUJGASLTD | 4,670,000 | 492.4 | -2.26% | 10.47% |
| ABB | 1,161,000 | 3,159.25 | -1.10% | 8.85% |
| DELTACORP | 15,502,000 | 215 | -4.93% | 6.94% |
| BEL | 74,316,600 | 110.85 | -0.49% | 5.75% |
(Decrease in price and increase in open interest)
52-week highs
A total of 17 stocks in the broadest index on BSE — the BSE 500 — hit 52-week highs.
| AMBUJACEM | FLUOROCHEM | SAPPHIRE |
| BANKBARODA | FORTIS | SUMICHEM |
| BDL | INDIACEM | THERMAX |
| CCL | INDUSINDBK | VBL |
| EIDPARRY | MAZDOCK | WELCORP |
| ESCORTS | MIDHANI |
52-week lows
Ten stocks hit 52-week lows.
| APLLTD | MASTEK |
| BIOCON | METROPOLIS |
| BSOFT | MPHASIS |
| COFORGE | SANOFI |
| JUBLPHARMA | SIS |
First Published: Sept 19, 2022 5:13 PM IST
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