Trade setup for Sept 17: Mount 18K next stop for Nifty50? Key market cues before Friday’s session
KV Prasad Jun 13, 2022, 06:35 AM IST (Published)
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Summary
Analysts see more upside in the market in the coming days, but warn that intraday corrections cannot be ruled out. Here’s how the September 17 session is poised to start.
Indian equity benchmarks zoomed to fresh peaks on Thursday led by strong buying interest in the banking pack and heavyweights such as Reliance Industries and ITC. The Nifty50 index not only touched the 17,600 mark for the first time but also closed almost 30 points above it. In good news for Bank Nifty faithfuls, the banking index jumped 2.2 percent to a record 37,668.6.
So, what do the charts suggest for Dalal Street?
Nagaraj Shetti, Technical Research Analyst at HDFC Securities, sees further gains in the market up ahead. The index has formed another long bull candle on the daily chart without any indication of tiredness or reversal at highs, he said.
A march to Mount 18k?
“Nifty50 has further shifted its support to 17,565-17,500 levels, and can be expected to trade with a positive bias from hereon,” said Rohit Singre, Senior Technical Analyst at LKP Securities. The index can be expected to march towards the 18,000 mark if it holds the support level, said Singre, who sees resistance in the 17,700-17,750 band now.
ALSO READ: It’s IT vs banks! Which sector should you be betting on right now?
Here are key things to know about the market before Friday’s session:
SGX Nifty
At 8:05 am on Friday, Nifty futures trading on Singapore Exchange — an early indicator of India’s Nifty50 benchmark index — were up 96.5 points or 0.6 percent at 17,702, suggesting a positive opening ahead on Dalal Street.
Global markets
Equities in other Asian markets were nearly unchanged on Friday, but headed for a weekly loss of nearly three percent. MSCI’s broadest index of Asia-Pacific shares outside Japan recovered early losses to trade flat. Global growth concerns have weighed on investors’ minds ever since Chinese data this week suggested growth in the world’s second-largest economy may slow in the second half of the year.
Overnight on Wall Street, two out of the three key indices fell 0.2 percent each, and the tech stocks-heavy Nasdaq Composite eked out a gain of 0.1 percent. S&P 500 E-Mini futures were down 0.1 percent in early Asian trade on Friday, suggesting a flat start in the US later in the day.
What to expect on Dalal Street
According to HDFC Securities’ Shetti, the Nifty50 index can go further up in the coming sessions. Banking and financial services spaces have started to outperform, and the overall chart pattern suggests the next possible target of 18,000 in the next 1-2 weeks. “Immediate support to be watched is at 17,470 and intraday corrections cannot be ruled out,” he said.
Rahul Sharma, Co-Founder of Equity99, expects PSU banking stocks to be in focus on Friday, besides telecom, specialty chemical and sugar counters.Â
The Cabinet has cleared the formation of a bad bank, Finance Minister Nirmala Sitharaman said on Thursday evening.
Key levels to watch out for
Nifty50: Sharma expects support for the index at 17,550, and then 17,450-17,300 levels, and resistance at 17,700- 17,850-18000 levels.
Bank Nifty: The banking index finds immediate support at 37,500, followed by 37,300-37,000, and meets resistance at 37,800, and then the 38,000-38,200 band, he said.
ALSO READ:Â Can you bank on Bank Nifty now?
FII/DII activity
Foreign institutional investors (FIIs) brought in a net Rs 1,621.9 crore into the Indian capital market on Thursday. Net sales by domestic institutional investors (DIIs) stood at Rs 795.1 crore, exchange data showed.
Call/put open interest
The maximum call open interest is accumulated at the strike price of 17,700, and the second highest at 17,800. On the other hand, the maximum put open interest is at the strike price of 17,600, followed by 17,500, NSE data shows. This suggests that immediate resistance can be expected at 17,700, and support comes in at 17,600, and then 17,500.
Long build-up
Here are five stocks that saw an increase in open interest as well as price, suggesting a build-up of long positions:
| Symbol |
Current OI |
CMP |
Price change (%) |
OI change (%) |
| CUB |
71,30,000 |
158.4 |
1.21% |
13.52% |
| BIOCON |
1,66,47,400 |
379.05 |
5.75% |
11.63% |
| MINDTREE |
20,79,200 |
4,175.05 |
1.30% |
11.18% |
| CHOLAFIN |
1,08,93,750 |
612 |
5.40% |
11.03% |
| INDUSINDBK |
1,59,39,900 |
1,131.25 |
7.16% |
11.01% |
Long unwinding
| Symbol |
Current OI |
CMP |
Price change (%) |
OI change (%) |
| ZEEL |
5,83,38,000 |
247.6 |
-3.51% |
-4.43% |
| BPCL |
4,42,47,600 |
439.55 |
-10.61% |
-3.45% |
| PFC |
2,89,85,000 |
137.1 |
-0.65% |
-2.72% |
| RECLTD |
2,49,48,000 |
157 |
-1.66% |
-2.55% |
| ESCORTS |
66,54,450 |
1,447 |
-1.32% |
-1.83% |
(Decrease in open interest and price)
Short-covering
| Symbol |
Current OI |
CMP |
Price change (%) |
OI change (%) |
| IDEA |
71,02,20,000 |
11.45 |
27.22% |
-15.40% |
| LICHSGFIN |
2,04,40,000 |
418 |
1.42% |
-3.32% |
| IEX |
89,38,750 |
610.25 |
1.45% |
-3.06% |
| IRCTC |
14,53,725 |
3,784 |
2.69% |
-2.19% |
| BANDHANBNK |
2,58,85,800 |
298.25 |
2.04% |
-1.77% |
(Decrease in open interest and increase in price)
Short build-up
| Symbol |
Current OI |
CMP |
Price change (%) |
OI change (%) |
| LUPIN |
89,47,100 |
959.5 |
-3.34% |
20.11% |
| TVSMOTOR |
46,92,800 |
544.2 |
-0.61% |
13.90% |
| ADANIENT |
2,07,92,000 |
1,508.10 |
-1.06% |
12.68% |
| ICICIGI |
22,82,250 |
1,612 |
-0.11% |
9.85% |
| LALPATHLAB |
4,62,500 |
4,101.95 |
-2.77% |
9.62% |
(Increase in open interest and decrease in price)
Stocks hitting 52-week highs
TCS, Bharti Airtel, ONGC, NTPC, Larsen & Toubro, Indian Oil, IndusInd Bank, Hindalco, HAL and Havells were among the 51 stocks in the BSE 500 index — the broadest index on the bourse — that clocked 52-week highs.
Indian Hotels, Titan, Voltas, VIP Industries, TeamLease, DMart, Naukri, Mindtree, Persistent, L&T Infotech, Coforge, Cholamandalam Investment, Bajaj Electricals, ABB India, Bata, Delta Corp, IEX and Zensar Tech also hit the milestone.
52-week lows
No stock in the BSE 500 universe logged a 52-week low. Aashka Hospitals and Krsnaa Diagnostics were among the few stocks that hit the trough.
Volatility gauge
NSE’s India VIX index — which gauges the expectation of volatility in the market —Â jumped five percent to 14.41 on Thursday, having risen as much as 5.8 percent during the session.
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