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Trade Setup for Thursday: Top 15 things to know before Opening Bell

The upper hurdle of 11,800 could be taken out soon, Nagaraj Shetti of HDFC Securities said
Oct 7, 2020 / 09:50 PM IST

The positive momentum continued for the fifth session in a row as bulls remained in a strong position at Dalal Street on October 7. Rising expectations of better Q2 earnings and hopes of stimulus could be supporting the market.

The Sensex ended up 304.38 points at 39,878.95 and the Nifty climbed 76.50 points at 11,738.90, the highest closing level since February 25, forming a bullish candle on the daily charts.

"Nifty sustained higher after the upside breakout of the initial hurdle at 11,550. It is then tried to move above the next important swing high of 11,795. This could be an indication of strength of bulls to surpass the hurdles. Hence, the upper hurdle of 11,800 could be taken out soon," Nagaraj Shetti, Technical Research Analyst at HDFC Securities, told Moneycontrol.

"Nifty sustaining above the next key reversal pattern -- Bearish Engulfing -- on the daily and weekly chart at 11,795 is expected to be an important signal of negation of the bearish pattern. Such negations tend to act as an uptrend continuation pattern. In such a scenario, the market could reach up to upper 12,250 levels in a short period of time," he said.

The broader markets underperformed frontliners with the Nifty Midcap index falling half a percent and Smallcap down a third of a percent.

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.

Key support and resistance levels on the Nifty

According to pivot charts, the key support levels for the Nifty is placed at 11,657.73, followed by 11,576.67. If the index moves up, the key resistance levels to watch out for are 11,791.43 and 11,844.07.

Nifty Bank

The Bank Nifty gained 111.10 points to 22,964.80 on October 7 and formed bullish candle on the daily scale. The important pivot level, which will act as crucial support for the index, is placed at 22,703, followed by 22,441.2. On the upside, key resistance levels are placed at 23,131.4 and 23,298.

Call option data

Maximum Call OI of 19.31 lakh contracts was seen at 12,000 strike, which will act as crucial resistance in the October series.

This is followed by 12,500, which holds 18.06 lakh contracts, and 11,800 strikes, which has accumulated 12.14 lakh contracts.

Call writing was seen at 12,300, which added 1.12 lakh contracts, followed by 12,100 and 12,200 strikes, which added 1.06 lakh contracts each.

Call unwinding was seen at 11,600, which shed 1.33 lakh contracts, followed by 11,500, which shed 97,575 contracts and 11,100 strikes, which shed 93,750 contracts.

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Put option data

Maximum Put OI of 25.23 lakh contracts was seen at 11,000 strike, which will act as crucial support in the October series.

This is followed by 11,300, which holds 18.40 lakh contracts, and 11,500 strikes, which has accumulated 18.05 lakh contracts.

Put writing was seen at 11,700, which added 4.32 lakh contracts, followed by 11,500, which added 3.15 lakh contracts, and 11,300 strikes, which added 2.63 lakh contracts.

Put unwinding was witnessed at 11,200, which shed 1.92 lakh contracts, followed by 12,100 strikes, which shed 2,625 contracts.

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Stocks with a high delivery percentage

A high delivery percentage suggests that investors are showing interest in these stocks.

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27 stocks saw long build-up

Based on OI future percentage, here are the top 10 stocks in which long build-up was seen.

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32 stocks saw long unwinding

Based on the OI future percentage, here are the top 10 stocks in which long unwinding was seen.

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45 stocks saw short build-up
An increase in OI, along with a decrease in price, mostly indicates a build-up of short positions. Based on OI future percentage, here are top 10 stocks in which short build-up was seen.

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34 stocks witnessed short-covering

A decrease in OI, along with an increase in price, mostly indicates a short-covering. Based on OI future percentage, here are top 10 stocks in which short-covering was seen.

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Bulk deals

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(For more bulk deals, click here)

Results on October 8

5paisa Capital, Prabhat Dairy, Titagarh Wagons, GM Breweries and Shree Ganesh Remedies will announce their quarterly earnings on October 8.

Stocks in the news

TCS reported a 6.7 percent QoQ rise in Q2 profit at Rs 7,475 crore with revenue growth of 4.7 percent. The IT major announced share buyback of Rs 16,000 crore.

Wipro: Board to consider buyback proposal on October 13.

RBL Bank: Deposits in Q2 FY21 grew 5 percent QoQ and 3 percent YoY. Gross advances declined 3 percent YoY and 1 percent QoQ, while retail advances grew 23 percent YoY and 7 percent QoQ. CASA ratio at 31.1 percent in Q2 FY21 against 30.1 percent QoQ and 26.5 percent YoY.

Nilkamal: CARE reaffirmed credit rating on company's long-term bank facilities at AA/Stable.

Shriram City Union Finance: CARE revised credit rating on company's NCDs to AA/Stable, from AA+/Negative.

Delta Corp closed its share buyback.

Ujaas Energy: CRISIL has downgraded its long-term rating on the bank facilities of company to 'D' from 'B-/Negative.

Fund flow

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FII and DII data

Foreign institutional investors (FIIs) net bought shares worth Rs 1,093.81 crore, whereas domestic institutional investors (DIIs) sold shares worth Rs 1,129.49 crore in the Indian equity market on October 7, as per provisional data available on the NSE.

Stock under F&O ban on NSE

Three stocks - Adani Enterprises, Bharat Heavy Electricals (BHEL) and Vodafone Idea - are under the F&O ban for October 8. 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.

Disclaimer: "Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd which publishes Moneycontrol."
Sunil Shankar Matkar
first published: Oct 7, 2020 09:50 pm
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