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Trade setup for Nov 17: Can Nifty50 escape its higher range? Check out key market cues before Wednesday's session

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Technical Analyst Manish Shah fears the Nifty could remain rangebound till a clear direction emerges. Here's what the technical charts suggest for the coming session on D-Street.

Trade setup for Nov 17: Can Nifty50 escape its higher range? Check out key market cues before Wednesday's session
Indian equity benchmarks suffered sharp losses on Tuesday dragged by fag-end selling in financial and oil & gas shares. Weakness in consumer and pharmaceutical stocks also pulled the headline indices lower, though gains in automobile and IT securities lent some support. The Bank Nifty tumbled one percent upon unsuccessful attempts to stay in positive territory.
What do the charts suggest for Dalal Street now?
The Nifty50 index has formed a long negative candle on the daily chart, hinting at correction within a broader range of 17,800-18,200 levels, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.
"Monday's high of 18,210 could now be considered a new higher top of this positive sequence. One may expect Nifty to find support around 17,800-17,850 levels in the next few sessions," he said. 
Independent Technical Analyst Manish Shah fears the Nifty could remain rangebound till a clear direction emerges.

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Weakness to prevail until 18,130
The market may rebound strongly after reaching significant support, believes Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities. A big base is seen at 17,950 on an immediate basis, a decisive break below which would increase the odds of 17,850 or 17,800 levels, he said.
Chouhan suggests the strategy of reducing weak long positions below 17,950, with major hurdles at 18,030 and 18,130. "The Nifty will remain in weak hands until the market does not cross 18,130," he said.
Here are key things to know about the market before Wednesday's session:
SGX Nifty
At 7:53 am on Wednesday, Nifty futures trading on Singapore Exchange -- an early indicator of the Nifty50 index -- were down 68.5 points or 0.4 percent at 17,936.5, suggesting a weak start ahead on Dalal Street.
Global markets
Equities in other Asian markets failed to reflect overnight gains on Wall Street, with MSCI's broadest index of Asia Pacific shares outside Japan down 0.4 percent. Japan's Nikkei 225 index was also down 0.4 percent.
S&P 500 futures were flat in early Asian trade. On Tuesday, the three main Wall Street indices rose 0.2-0.8 percent as optimism on holiday sales helped investors look past uncertainty over hawkish measures by the Federal Reserve.
What to expect on Dalal Street
Shah believes Nifty remains in a lethargic mode, as it continues to oscillate aimlessly in the narrow band of 18,100-17,950. He said it could remain in a prolonged sideways range between 17,900 and 18,100.
"MACD is in a sell mode and RSI (momentum indicators) hovers around its equilibrium. With the momentum lost, Nifty could see a drop towards 17,900 and then reverse to rally to 18,100. With the expiry week getting over in the next two days, the Nifty will not trade below 17,800 and above 18,050," he added.
The market is expected to remain in a downward trend, though some movement in auto stocks may be there given the optimism on the chip shortage issue, according to Rahul Sharma, Co-Founder of Equity99.
Besides auto stocks, he expects banking, specialty chemical and realty names to be in focus on Wednesday.
Key levels to watch out for
Nifty50: Major support for the index is expected at 17,920, followed by more support at 17,850 and then 17,700, and a major hurdle is pegged at 18,075, followed by resistance at 18,200 and then 18,300, according to Sharma.
Bank Nifty: For the banking index, major support is expected at 38,150 and major resistance at 38,500, he said.
FII/DII activity
Foreign institutional investors (FIIs) were net sellers of Indian equities worth Rs 560.7 crore on Tuesday. Net purchases by domestic institutional investors stood at Rs 577.3 crore, according to provisional exchange data.
Call/put open interest
The maximum open interest remains at the strike price of 18,200, and there is a high degree of accumulation each at 18,100 and 18,500. The maximum put open interest remains at 18,000, and the next highest at 17,800 and 17,500, NSE data shows. This suggests immediate resistance can be expected at 18,200, followed by the hurdle of 18,500, and support at 18,000 is followed by 17,800.
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:
SymbolCurrent OICMPPrice change (%)OI change (%)
COFORGE5,84,3005,735.704.84%32.12%
BSOFT21,45,000441.44.67%26.73%
CHAMBLFERT9,00,000377.35.64%25.83%
M&M1,06,54,700956.653.04%16.65%
MARUTI24,10,1008,0687.14%16.08%
Long unwinding
SymbolCurrent OICMPPrice change (%)OI change (%)
LAURUSLABS36,18,000491.35-0.04%-4.58%
STAR34,70,850514.9-0.19%-4.08%
ABBOTINDIA35,40019,800-1.05%-3.18%
NAVINFLUOR7,39,3503,518.60-0.84%-2.74%
ALKEM6,93,0003,554.65-1.26%-2.74%
(Decrease in open interest and price)
Short-covering
SymbolCurrent OICMPPrice change (%)OI change (%)
IRCTC1,28,00,125919.71.53%-8.92%
HEROMOTOCO44,29,2002,752.451.82%-7.65%
TATAPOWER9,93,87,000244.10.68%-6.55%
PERSISTENT3,41,5504,2900.49%-3.73%
BOSCHLTD1,58,65018,646.951.98%-2.24%
(Increase in price and decrease in open interest)
Short build-up
SymbolCurrent OICMPPrice change (%)OI change (%)
ASHOKLEY4,07,79,000146.05-4.26%19.37%
GLENMARK89,19,400516.45-4.03%9.91%
VOLTAS19,02,0001,236.60-2.74%8.86%
RBLBANK2,86,20,100207.95-0.07%8.68%
JKCEMENT1,57,5003,460.30-1.40%7.67%
(Increase in open interest and decrease in price)
52-week highs
InterGlobe Aviation, Ashok Leyland, Force Motors, L&T Infotech, Mindtree, Page Industries, Adani Enterprises, Bata, Rajesh Exports, Jamna Auto, Lemontree and Thermax were among the 24 stocks in the BSE 500 index — the broadest gauge on the bourse — that hit 52-week highs.
52-week lows
Five stocks in the index hit 52-week lows: Aarti Drugs, Aegis Logistics, Spandana Sphoorty, Bayer Cropscience and Procter & Gamble Health.
Volatility gauge
NSE's India VIX index — which gauges the expectation of volatility in the near term — eased 1.7 percent to 15.2 on Tuesday.
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