Chandan Taparia of Motilal Oswal Financial Services said Nifty index has to continue to hold above 11,550 to witness an upmove towards 11,760 then a fresh move towards 11,888-11,920
The market jumped on April 5 after consolidating for a few sessions, driven by banking and financials and metals stocks. Technology stocks also participated in the run ahead of TCS and Infosys' March quarter earnings scheduled on April 12.
"With the onset of Q4 results, the IT sector is seeing momentum building up with longs created in TCS as well as Infosys. Option data too is showing build-up in the Out-of-the-Money options, mainly in Calls while Put accumulation remains high near to ATM strikes," Shubham Agarwal, CEO & Head of Research at Quantsapp Private Limited told Moneycontrol.
On April 5, the 30-share BSE Sensex climbed 177.51 points to 38,862.23 while the Nifty50 rose 67.95 points to 11,665.95 and formed bullish candle which resembles a 'Spinning Top' kind of formation on daily charts.
Nifty made a new life-time high of 11,761 during the week just eclipsing the previous high of 11,760 but consolidated for the most part of the week with buying interest on declines. The index rose 0.4 percent and formed 'Long Legged Doji' kind of pattern on the weekly scale.
"It has recently taken support at previous swing high of 11,550 and got stuck in between 11,550 to 11,760 from last six trading sessions. It formed a small bodied bullish candle on the daily scale while a Doji candle on the weekly scale that indicates declines are being bought," Chandan Taparia, Associate Vice President and Analyst-Derivatives, Motilal Oswal Financial Services told Moneycontrol.
He said now index has to continue to hold above 11,550 to witness an upmove towards 11,760 then a fresh move towards 11,888-11,920.
The Nifty Midcap index gained 0.82 percent on April 5 but lost 0.1 percent during the week.
We have collated 15 data points to help you spot profitable trades:
Key support and resistance level for Nifty
Nifty closed at 11,665.95 on April 5. According to the Pivot charts, the key support level is placed at 11,620.43, followed by 11,574.87. If the index starts moving upward, key resistance levels to watch out are 11,700.63 and 11,735.27.
The Nifty Bank index closed at 30,084.65, up 179.75 points on April 5. The important Pivot level, which will act as crucial support for the index, is placed at 29,898.47, followed by 29,712.23. On the upside, key resistance levels are placed at 30,222.47, followed by 30,360.23.
Call options data
Maximum Call open interest (OI) of 23.30 lakh contracts was seen at the 12,000 strike price. This will act as a crucial resistance level for the April series.
This was followed by 11,800 strike price, which now holds 18.90 lakh contracts in open interest, and 11,900, which has accumulated 14.90 lakh contracts in open interest.
Significant Call writing was seen at the 11,500 strike price, which added 0.75 lakh contracts, followed by 11,700 strike that added 0.52 lakh contracts and 11,900 strike that added 0.43 lakh contracts.
Call unwinding was seen at the strike price of 12,000 that shed 1.18 lakh contracts, followed by 11,300 strike that shed 0.98 lakh contracts and 11,800 strike that shed 0.62 lakh contracts.
Put options data
Maximum Put open interest of 22.65 lakh contracts was seen at 11,500 strike price. This will act as a crucial support level for the April series.
This was followed by 11,200 and 11,600 strikes which now hold 16.90 lakh contracts each in open interest.
Put writing was seen at the strike price of 11,600, which added 3.47 lakh contracts, followed by 11,700 strike that added 2.03 lakh contracts and 11,500 strike that added 1.25 lakh contracts.
There was hardly any Put unwinding seen.
FII & DII data
Foreign Institutional Investors (FIIs) bought shares worth Rs 797.9 crore while Domestic Institutional Investors (DIIs) sold Rs 325.58 crore worth of shares in the Indian equity market on April 5, as per provisional data available on the NSE.
Fund flow picture
Stocks with a high delivery percentage
High delivery percentage suggests investors are accepting the delivery of the stock, which means that investors are bullish on it.
61 Stocks saw a long buildup
75 stocks saw short covering
A decrease in open interest along with an increase in price mostly indicates short covering.
33 stocks saw a short build-up
An increase in open interest along with a decrease in price mostly indicates a build-up of short positions.
43 stocks saw long unwinding
Bulk Deals on April 5
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Analyst or Board Meet/Briefings
Hathway Cable & Datacom: Company will announce its March quarter earnings on April 15.
TRF: Company will announce its March quarter earnings on April 15.
Stocks in news
Future Consumer: Board approved issuing of up to $10 million worth Compulsorily Convertible Debentures to Verlinvest SA, and Rs 250 crore worth to International Finance Corporation on a preferential basis. The board also approved issuing of warrants to promoter/promoter group entities, for an amount of Rs 70 crore on a preferential basis.
NIIT Technologies: Hulst BV along with the Baring Asia Private Equity Fund VII announced an open offer for acquisition of up to 1.62 crore equity shares (representing 26 percent of paid-up equity) from public shareholders of the company, at a price of Rs 1,394 per share, an aggregating total of Rs 2,262.34 crore. It is after Hulst & Baring acquired 30.20 percent stake in the company from NIIT Limited and company's promoters on April 6.
Century Textiles: Company launched real estate project viz. Birla Vanya near Kalyan, Maharashtra.
Vanta Bioscience: Company through its subsidiary, Vayam Research Solutions, signs CRO Service Agreement of Rs 29 crore with Emcure Pharmaceuticals.
GE Power India: Company appointed Prashant Jain as Additional Director and Managing Director.
HPL Electric: Company issued Commercial Papers of Rs 150 crore.
Muthoot Finance: Company declared an interim dividend for FY 2019 at the rate of Rs 12 per equity share.
Kernex Microsystems (India): Company received a Show Cause Notice from Directorate General of GST Intelligence Hyderabad Zonal Unit.
Eris Lifesciences: Company executed a share purchase agreement with one of the founders and promoters to take full ownership of the subsidiary.
India Nippon Electricals: Company declared the second interim dividend at Rs 4 per equity share for the year 2018-19.
Torrent Pharma: Company's Dahej plant receives certain observations from USFDA.
Khaitan India: Company appointed Swapan Kumar Das as the chief financial officer (CFO).
Lumax Industries: Company acquired assets for manufacturing of PCB’s for Rs 22.45 crore from Lumax Auto Technologies.
Reliance Infrastructure: Company appointed Punit Garg as executive director and chief executive officer (CEO).
United Nilgiri Tea Estates: Company's director N. Srinivasan resigned.
Cadila Healthcare: Zydus received tentative approval from the USFDA for Tofacitinib tablets.
Edelweiss Financial Services: ICRA re-affirmed A1+ rating to the commercial paper programme of Rs 6,350 crore and short-term NCDs of Rs 100 crore. It also re-affirmed the credit rating of AA to the NCDs of Rs 466 crore.
Five stocks under ban period on NSE
Securities in ban period for the next day's trade under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.For April 8, Adani Power, DHFL, IDBI Bank, Jet Airways and Reliance Power are present in this list.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.