Bears took control of Dalal Street on September 17 after the bulls' presence in the previous session had helped the Nifty surpass the 11,600 mark. The market erased almost all its previous day's gains, following correction in global peers amid no comments on stimulus measures by the US Federal Reserve.
The Sensex fell 323 points to close at 38,979.85, while the Nifty dropped 88.40 points to 11,516.10 and formed a small bodied bearish candle on the daily charts, which indicates a false upside breakout attempt to its resistance at 11,600 levels.
"The formation of Thursday's pattern could signal an emergence of profit booking from the highs, but we are not anticipating any sharp reversal from the highs as of now. There is an absence of long bear candle formation at the highs and this downward correction is likely to end soon," Nagaraj Shetti, Technical Research Analyst at HDFC Securities, told Moneycontrol.
"Any decline from here, Nifty could find support at 20-day EMA (Exponential Moving Average) around 11,430, but we have seen a mild upside bounce from this moving average recently. The Nifty also failed to continue with its bullish positive sequence of higher tops and bottoms recently, which could be a cause of concern for bulls at the highs," he said.
The broader markets also corrected with the Nifty Midcap and Smallcap indices falling 0.24 percent and half a percent, respectively. Among sectors, Nifty Bank, financial services and metal indices declined over a percent each.
Ajit Mishra, VP-Research at Religare Broking, reiterated that a directional move in the market seems difficult unless there is an alignment between the Nifty and Bank Nifty. He advised traders to maintain their focus on sectors, which are attracting buying interest, and plan their trades accordingly.
We have collated 15 data points to help you spot profitable trades:
Note: The open interest (OI) and volume data of stocks given in this story are the aggregates of three- month data and not of the current month only.
This is followed by 11,600, which holds 29.16 lakh contracts, and 11,500 strikes, which has accumulated 28.44 lakh contracts.
Call writing was seen at 11,500, which added 9.74 lakh contracts, followed by 11,600, which added 8.57 lakh contracts, and 12,000 strikes, which added 7.86 lakh contracts.
There was hardly any Call unwinding seen on September 17.
Put option data
This is followed by 11,000, which holds 31.47 lakh contracts, and 11,400 strikes, which has accumulated 22.77 lakh contracts.
Put writing was seen at 10,800, which added 5.54 lakh contracts, followed by 11,000, which added 4.29 lakh contracts, and 11,400 strikes, which added 3.39 lakh contracts.
Put unwinding was witnessed at 11,200, which shed 1.13 lakh contracts, followed by 11,600 strikes, which shed 57,450 contracts.
Stocks with a high delivery percentage
23 stocks saw long build-up
38 stocks saw long unwinding
53 stocks saw short build-up
24 stocks witnessed short-covering
Happiest Minds Technologies: Plutus Wealth Management bought 10 lakh shares in the company at Rs 350 per share on the NSE.
United Polyfab Gujarat: Promoter entities Vinodkumar Mangalchand Mittal, Urmila Nirmal Mittal, Radha Vinodkumar Mittal, Nirmalkumar Mangalchand Mittal, Kusumdevi Sureshkumar Mittal, Kamaladevi Anilkumar Mittal, Anilkumar Mangalchand Mittal and Sureshkumar Mittal acquired 51,000 shares each at Rs 12.85 per share. However, Dhanshree Barter Pvt sold 4,08,000 shares in the company at the same price.
(For more bulk deals, click here)Analysts/board meetings
Mahindra & Mahindra representatives will meet Fidelity Investments on September 18 and attend Ambit Virtual Investor Conference on September 21 and JP Morgan Virtual Investor Conference on September 22.
KPR Mill: Meeting of the Board of Directors is scheduled on September 24 to consider among other subjects the current business scenario.
Ramco Cements: Online investors' meet is scheduled on September 18 organised by Axis Mutual Fund and HDFC Mutual Fund.
Dr Lal PathLabs representatives will meet Mirae Asset Management via conference call on September 18.
Endurance Technologies: A tele-conference with Wellington Management Singapore has been scheduled on September 18 to discuss the company's business and the automotive industry.Stocks in the news
Hindalco Industries and Hindustan Copper signed a memorandum of understanding (MoU) for supply of copper concentrate.
Dr Reddy's Laboratories settles patent litigation for Revlimid with Celgene, a Bristol Myers Squibb Company, which allowed the company to sell Lenalidomide in the US post March 2022.
Asian Paints: Promoter entity Sattva Holding and Trading created a pledge on 18.71 lakh equity shares.
Arrow Greentech: Production operations will recommence at Ankleshwar plant as Gujarat Pollution Control Board (GPCB) issued interim revocation order.
EIH sets rights share issue price at Rs 65 per share. Shareholders will receive eight rights shares for every 85 shares held.
TVS Motor Company appointed Auteco SAS as new distributor in Colombia.
Fund flowFII and DII data