The market closed higher on May 19 after three days of losses, as buying in the last hours helped the Nifty50 close above 18,200. Information technology, banks, auto and some metal stocks supported the benchmark indices.
The Sensex closed 298 points higher at 61,730 and the Nifty 73 points at 18,203 and formed a bullish hammer pattern on the daily scale.
"A small positive candle was formed on the daily chart with a long lower shadow. Technically, this candle pattern indicates the formation of a bullish hammer-type pattern. Normally, formation of such hammer patterns post reasonable decline signal possible reversal on the upside post confirmation," Nagaraj Shetti, Technical Research Analyst at HDFC Securities, said.
The short-term trend for the Nifty remains choppy but the emergence of buying interest from the lows on May 19 raises hopes of an upside bounce, he said.
The confirmation of the bullish hammer pattern could pull the Nifty towards the crucial resistance band of 18,400-18,500 again, Nagaraj said.
We have collated 15 data points to help you spot profitable trades:
Note: The open interest (OI) and volume data of stocks in this article are the aggregates of three-month data and not just the current month.
Key support, resistance levels on Nifty
Pivot charts indicate that the Nifty may get support at 18,100 followed by 18,063 and 18,003. If the index advances, 18,221 would be the key resistance level to watch out for followed by 18,258 and 18,318.
The Bank Nifty extended gains for yet another session, climbing 217 points to 43,969 and formed a Bullish Pin Bar candle with a long lower shadow on the daily scale, which suggests buying at lower zones.
On the weekly scale, it formed a small bullish candle and higher highs - higher lows for the eighth straight week. It has to hold above 43,750 to move towards 44,144 then 44,250, while on the downside, the support is expected at 43,500, then 43,333, Chandan Taparia, senior vice president | analyst-derivatives at Motilal Oswal Financial Services said.
As per the pivot point calculator, the Bank Nifty may take support at 43,654, followed by 43,539 and 43,352. Key resistance levels are 44,028, 44,143 and 44,330.
On the monthly options front, the maximum call open interest (OI) was at 18,200 strike, with 84.5 lakh contracts, which is expected to be a crucial level for the Nifty.
This was followed by 18,400 strike comprising 79.14 lakh contracts and 18,500 strike with more than 79.1 lakh contracts.
Call writing was seen at 18,400 strike, which added 17.75 lakh contracts, followed by 18,600 strike, which added 15.41 lakh, and 18,500 strike, which added 11.74 lakh contracts.
Call unwinding was at 19,000 strike, which shed 24.17 lakh contracts, followed by 18,700 strike, which shed 8.33 lakh contracts, and 18,300 strike, which shed 3.19 lakh contracts.
The maximum put open interest was at 18,200 strike, with 80.6 lakh contracts, which is expected to be an important support in the coming sessions.
This was followed by the 18,000 strike, comprising 76.7 lakh contracts, and 17,500 strike with 65.83 lakh contracts.
Put writing was seen at 18,000 strike, which added 22.67 lakh contracts, followed by 18,100 strike, which added 20.13 lakh contracts, and 17,500 strike, which added 18.96 lakh contracts.
Put unwinding was seen at 18,300 strike, which shed 4.99 lakh contracts, followed by 18,500 strike, which shed 1.18 lakh contracts, and 18,400 strike, which shed 33,550 contracts.
Stocks with high delivery percentage
A high delivery percentage suggests that investors are showing interest in the stock. The highest delivery was seen in Infosys, Sun Pharmaceutical Industries, Pidilite Industries, Dabur India and Nestle India among others.
An increase in open interest (OI) and price typically indicates a build-up of long positions. Based on the OI percentage, 51 stocks, including Samvardhana Motherson International, Birlasoft, Polycab India, JK Cement, and Persistent Systems, saw long build-ups.
A decline in OI and price generally indicates a long unwinding. Based on the OI percentage, 40 stocks, including Chambal Fertilizers, Abbott India, Aditya Birla Fashion & Retail, Alkem Laboratories, and Container Corporation of India, saw long unwinding.
60 stocks see a short build-up
An increase in OI along with a price decrease indicates a build-up of short positions. Based on the OI percentage, 60 stocks, including Siemens, M&M Financial Services, HDFC AMC, Zydus Life Sciences and Mahanagar Gas, saw a short build-up.
A decrease in OI along with a price increase is an indication of short-covering. Based on the OI percentage, 36 stocks were on the short-covering list. These included Whirlpool, PI Industries, Balrampur Chini Mills, LIC Housing Finance and Ramco Cements.
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Shree Cement, Bharat Petroleum Corporation, PB Fintech, Aditya Birla Fashion and Retail, CESC, Capri Global Capital, EIH, Finolex Industries, Fusion Micro Finance, Gujarat Alkalies & Chemicals, HCL Infosystems, HEG, Indiabulls Housing Finance, Radiant Cash Management Services, SJVN, Sun Pharma Advanced Research Company, and Waaree Technologies will be in focus ahead of quarterly earnings on May 22.
Stocks in the news
NTPC: The country's largest power generation company recorded one percent year-on-year increase in standalone profit at Rs 5,672.3 crore for the March quarter of FY23 despite weak operating margin, supported by higher topline and other income. Overall, earnings, barring bottomline, missed estimates. Standalone revenue from operations grew by 20.3 percent to Rs 41,318 crore from the year-ago period.
Zomato: The food delivery giant's consolidated loss for the March quarter narrowed to Rs 187.6 crore from a loss of Rs 359.7 crore in the same period last year, as topline increased sharply and operating loss narrowed. Consolidated revenue from operations grew by 70 percent YoY to Rs 2,056 crore in Q4FY23.
JSW Steel: The JSW Group's flagship company reported a 12 percent year-on-year growth in consolidated profit at Rs 3,741 crore for the March quarter due to low base and higher other income, but impacted by dismal operating performance. Revenue from operations for Q4FY23 grew by 0.1 percent to Rs 46,962 crore from the year-ago period.
Bandhan Bank: The private sector lender registered a massive 57.5 percent year-on-year decline in profit at Rs 808 crore in the March quarter of FY23, hit by significantly higher provisions & contingencies. Lower non-interest income, net interest income and pre-provision operating profit also impacted profitability. Net interest income fell 2.7 percent to Rs 2,472 crore from the year-ago quarter, with a 140 bps decline in net interest margin.
Power Grid Corporation of India: The state-owned power transmission utility recorded a 4 percent year-on-year increase in consolidated profit at Rs 4,320.4 crore in the March quarter, driven by healthy topline and operating performance. Revenue from operations at Rs 12,264 crore grew by 14.7 percent over a year-ago period.
Delhivery: The logistics services provider reported a consolidated loss of Rs 158.6 crore for the March quarter, widening losses from Rs 119.8 crore in same period last year. Lower topline and weak operating performance impacted profitability. Consolidated revenue from operations fell 10.2 percent YoY to Rs 1,860 crore.
JK Lakshmi Cement: The cement company reported a 40.1 percent year-on-year decline in consolidated profit at Rs 110 crore in the March quarter, impacted by weak operating numbers. Consolidated revenue grew 16.4 percent year on year to Rs 1,862 crore, with sales volume increasing 3 percent to 33.88 lakh tonnes.
Fund Flow
Foreign institutional investors (FIIs) sold shares worth Rs 113.46 crore, whereas domestic institutional investors (DIIs) bought shares worth Rs 1,071.35 crore on May 19, provisional data from the National Stock Exchange showed.
Stocks under F&O ban on NSE
The National Stock Exchange has retained L&T Finance Holdings, Aditya Birla Fashion & Retail, Balrampur Chini Mills, Delta Corp, GNFC, and Manappuram Finance to its F&O ban list for May 22. Securities in the ban period under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.
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