Indian equity benchmarks hit fresh two-month closing lows on Wednesday as the market continued to fall for the sixth session in a row. Globally, nervousness persisted among investors amid fears of steep rate hikes and their impact on economic growth.
Analysts expect volatility ahead of the expiry of monthly derivative contracts due by the end of Thursday's session. Investors await the outcome of deliberations of the RBI's rate-setting panel due on Friday.
What do the charts suggest for Dalal Street?
The Nifty50 has formed a small negative candle on the daily chart with a long upper shadow, suggesting the making of a high wave or doji-type pattern, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.
"The overall market trend is still weak and there is no confirmation of any buying emerging from the lows," he said.
More pain likely for those banking on the banking basket
"The Nifty Bank's slide below key support at 38,000 indicates further bearishness in the near term," said Kunal Shah, Senior Technical Analyst at LKP Securities.
He believes the banking index continues to be in a sell-on-rise mode with multiple hurdles in the 38,500-39,000 zone. "The next crucial support is placed at 36,000, which coincides with its 200-day moving average."
Here are key things to know about the market ahead of the September 29 session:
SGX Nifty
On Thursday, Singapore Exchange (SGX) Nifty futures — an early indicator of the Nifty index — rose as much as 191.5 points or 1.1 percent to 17,078 ahead of the opening bell on Dalal Street.
Global markets
Equities in other Asian markets began Thursday in the green, following an overnight jump on Wall Street on the back of falling Treasury yields. MSCI's broadest index of Asia Pacific shares outside Japan was up 0.9 percent at the last count.
Japan's Nikkei 225 was up 0.3 percent, China's Shanghai Composite 0.8 percent and Hong Kong's Hang Seng 1.3 percent.
S&P 500 futures were down 0.3 percent. On Wednesday, the S&P 500 finished two percent higher, the Dow Jones rose 1.9 percent and the tech stocks-heavy Nasdaq Composite 2.1 percent.
What to expect on Dalal Street?
HDFC Securities' Shetti expects a pullback rally in the market from 16,750-16,800 levels in the next 1-2 sessions, and immediate resistance at 17,000.
Key moving averages
The Nifty and the Nifty Bank are around 4-5 percent below their long-term simple moving averages in a bearish sign.
| No. of sessions | Nifty50 | Nifty Bank |
| 5 | 16,918.2 | 37,990.2 |
| 10 | 16,942 | 38,092.4 |
| 20 | 16,997.5 | 38,370.2 |
| 50 | 17,322.4 | 39,565.9 |
| 100 | 17,588.9 | 40,316.9 |
| 200 | 17,611.4 | 39,887.2 |
FII/DII activity
Foreign institutional investors (FIIs) remained net sellers of Indian shares for the sixth trading day in a row on Wednesday, according to provisional exchange data.
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Call/put open interest
The maximum call open interest is accumulated at the strike price of 17,000, with 1.9 lakh contracts, and the next highest at 17,500, with 1.7 lakh, according to exchange data. On the other hand, the maximum put open interest is placed at the strikes of 16,800, 16,500 and 16,000, with 1.1 lakh contracts each.
This suggests strong resistance at 17,000 and strong support at 16,800 followed by 16,500.
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 |
| PAGEIND | 45,690 | 50,062.80 | 0.70% | 32.86% |
| LALPATHLAB | 505,750 | 2,685.30 | 1.18% | 32.53% |
| ASIANPAINT | 2,752,800 | 3,569 | 2.86% | 30.60% |
| HAVELLS | 1,802,500 | 1,320 | 0.27% | 30.18% |
| DABUR | 3,885,000 | 565 | 0.61% | 28.80% |
Long unwinding
| Stock | Current OI | CMP | Price change | OI change |
| IPCALAB | 450,450 | 892.5 | -1.48% | -35.93% |
| COFORGE | 292,950 | 3,421 | -1.53% | -30.93% |
| FSL | 7,160,400 | 101.65 | -0.93% | -29.34% |
| NAVINFLUOR | 282,600 | 4,417.45 | -0.69% | -26.99% |
| BAJAJFINSV | 3,279,000 | 1,644 | -2.16% | -26.99% |
(Increase in price and decrease in open interest)
Short covering
| Stock | Current OI | CMP | Price change | OI change |
| IBULHSGFIN | 8,672,000 | 113.9 | 0.49% | -39.25% |
| ASTRAL | 440,825 | 2,190.80 | 0.84% | -33.13% |
| INTELLECT | 873,750 | 542.05 | 0.95% | -32.88% |
| DRREDDY | 623,625 | 4,260.10 | 1.65% | -23.13% |
| PERSISTENT | 330,450 | 3,189.75 | 0.10% | -22.79% |
(Increase in price and decrease in open interest)
Short build-up
| Stock | Current OI | CMP | Price change | OI change |
| TORNTPHARM | 683,500 | 1,495.50 | -2.52% | 50.69% |
| MARUTI | 1,477,900 | 8,699.75 | -0.81% | 41.23% |
| ATUL | 102,375 | 8,754.30 | -1.78% | 34.95% |
| GODREJCP | 2,448,000 | 881.35 | -0.21% | 32.07% |
| SIEMENS | 772,475 | 2,699.50 | -0.93% | 28.05% |
(Decrease in price and increase in open interest)
52-week highs
Three stocks in the BSE 500 universe — the broadest index on the bourse — scaled the milestone: Cipla, Asian Paints and Gujarat Fluorochemicals.
52-week lows
On the other hand, 17 stocks hit 52-week lows:
| ALOKTEXT | IOC | OIL |
| DHANUKA | JCHAC | PGHL |
| GLAND | LICI | SHILPAMED |
| GRAPHITE | MASTEK | SONACOMS |
| IEX | MEDPLUS | SYMPHONY |
| INDOCO | NATCOPHARM |
First Published: Sept 28, 2022 9:35 PM IST
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