Moneycontrol
Nov 13, 2017 08:46 PM IST | Source: Moneycontrol.com

Trade Setup for Tuesday: Top 10 things you should know before Opening Bell

Investors are advised to remain cautious and focus on stock specific opportunities. Bulls will only be able to gain momentum when Nifty climbs back above 10,350 levels. However, if the weakness persists Nifty could slip towards 10,100.

Uttaresh Venkateshwaran @UttareshV

The Nifty which started on a muted note on Monday failed to pull the index back above 10,300 which it was able to do in the past two sessions and made a solid bear candle on the daily candlestick charts.

After a bearish crossover registered on MACD charts on November 8, Supertrend Indicator too gave a ‘SELL’ signal on the daily candlestick charts today.

'Supertrend' is a trend following indicator just like Moving Averages and MACD (Moving Average Convergence Divergence). It is plotted on prices and their placement indicates the current trend.

The last time it gave a sell call was on 25th September 2017. The index went on to record a low of 9,690 before bouncing back towards 10,000 when it triggered a buy signal again on the charts.

The Nifty opened at 10,322 and rose marginally to hit an intraday high of 10,334. It slipped to an intraday low of 10,216 before closing the day at 10,224, down 96 points.

Investors are advised to remain cautious and focus on stock specific opportunities. Bulls will only be able to gain momentum when Nifty climbs back above 10,350 levels. However, if the weakness persists Nifty could slip towards 10,100.

“Bulls disappointed as Nifty registered a solid bear candle after two days of positive consolidation dashing the hopes of a pullback rally. It is looking more like a resumption of downswing after consolidation breakdown on lower time frame charts,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.

“Hence, traders should not be in a hurry to go for long positions as supports are getting broken down one after the other. It will be prudent to wait for a strength above 10350 levels rather than buying the dip in haste,” he said.

Mohammad further added that if the weakness persists then Nifty should ideally go down all the way down to 10100 levels as we have been pointing out for quite some time when the correction was triggered around 10490 levels.

We have collated top ten data points to help you spot profitable trade.

Key Support & Resistance Level for Nifty:

The Nifty closed at 10,225.0 on Monday. According to Pivot charts, the key support level is placed at 10,182.73, followed by 10,140.47. If the index starts to move higher, key resistance levels to watch out are 10,300.73 and 10,376.47.

Nifty Bank:

The Nifty Bank closed at 25,358.3 on Monday. Important Pivot level, which will act as crucial support for the index, is placed at 25,259.79, followed by 25,161.3. On the upside, key resistance level is 25,534.2 followed by 25,710.1.

Call Options Data:

Maximum Call OI of 55.23 lakh contracts was seen at strike price 10,500 which will act as a crucial base for the index in November series, followed by 10,400, which has accumulated 48.38 lakh contracts in open interest, and 10,300, which now holds 40.02 lakh contracts in open interest.

Call writing was seen at strike price of 10,400, which saw the addition of 10.84 lakh contracts, along with 10,500, which saw the addition of 9.48 lakh contracts, and 10,300, which saw the addition of 7.32 lakh contracts.

There was hardly any Call Unwinding seen.

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Put Options Data:

Maximum Put open interest (OI) of 49.14 lakh contracts, stands at strike price 10,200, which will act as a crucial resistance level for the index in the November series, followed by 10,000, which now holds 46.69 lakh contracts in open interest, and 10,300, which has accumulated 45.51 lakh contracts in OI.

There was hardly any Put writing seen.

Put unwinding was seen at strike prices 10,200 (7.03 lakh contracts were shed), followed by 10,100, which saw shedding of 5.63 lakh contracts and 10,300, which shed 3.57 lakh contracts.

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FII & DII Data:

The foreign institutional investors (FIIs) sold shares worth Rs 233.56 crore, while domestic institutional investors sold Rs 268.77 crore worth of shares in the Indian equity market on Monday, data available with the NSE showed.

Stocks with high delivery percentage:

High delivery percentage suggests that investors are accepting the delivery of the stock which means that investors are bullish on the stock.

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24 stocks saw long buildup

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38 stocks saw short covering:

A decrease in open interest along with an increase in price mostly indicates short covering.

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92 stocks saw short buildup:

An increase in open interest along with a decrease in price mostly indicates short positions being built up.

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58 stocks saw long unwinding

Long Unwinding happens when there is a decrease in OI as well as in price.

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