Experts expect the ongoing quarterly earnings season to add to the persistent volatility.
The market closed with a marginal loss amid volatility on January 8 with the Nifty defending the psychological 12,000-mark. It started the day sharply lower by falling a percent amid the fear of escalation in geopolitical tensions after Iran forces fired missiles on the US troops at Iraqi airbases.
The BSE Sensex slipped nearly 400 points in the morning but erased most of the losses to end just 51.73 points lower at 40,817.74. The Nifty 50 declined 27.60 points to 12,025.40, forming a big bullish candle as closing was higher than the opening tick.
"The short term trend of Nifty continues to be weak. Though the Nifty showed a promising intraday upside bounce today, this up move is unlikely to sustain for long," Nagaraj Shetti, Technical Research Analyst at HDFC Securities told Moneycontrol.
According to him, the Nifty is expected to find key overhead resistance around 12,100-12,150 levels in the next 1-2 sessions, which could be a sell on rise opportunity. The important lower support is placed at 11,800, he said.
All sectoral indices, barring FMCG and IT, closed in the red. The broader markets closed mixed with Nifty Midcap index rising a third of a percent and Smallcap rising a third of a percent.
"We do not see this volatility to fade away anytime soon and in fact, the prevailing earnings season would further add to the erratic swings ahead," Ajit Mishra, VP - Research at Religare Broking said.
"We thus advise focusing more on stock selection and risk management aspects. Also, keeping a close eye on global developments for cues," he added.
We have collated 15 data points to help you spot profitable trades:
Key support and resistance level for Nifty
According to the pivot charts, the key support level for Nifty is placed at 11,954.93, followed by 11,884.57. If the index moves up, key resistance levels to watch out for are 12,070.33 and 12,115.37.
Nifty Bank closed at 31,373.65, down 0.08 percent on January 8. The important pivot level, which will act as crucial support for the index, is placed at 31,031.59, followed by 30,689.5. On the upside, key resistance levels are placed at 31,583.79 and 31,793.9.
Call options data
Maximum Call open interest (OI) of 24.71 lakh contracts was seen at the 12,500 strike price. It will act as a crucial resistance level in the January series.
This is followed by 12,300 strike price, which holds 21.36 lakh contracts in open interest, and 12,400, which has accumulated 20.09 lakh contracts in open interest.
Significant call writing was seen at the 12,000 strike price, which added 2.09 lakh contracts, followed by 12,100 strike price that added 1.11 lakh contracts and 12,300 strike which added 0.72 lakh contracts.
Call unwinding was witnessed at 12,500 strike price, which shed 2.69 lakh contracts, followed by 12,700 strike which shed 1.78 lakh contracts and 12,200 strike which shed 1.01 lakh contracts.
Put options data
Maximum Put open interest of 39.46 lakh contracts was seen at 12,000 strike price, which will act as crucial support in the January series.
This is followed by 11,500 strike price, which holds 28.34 lakh contracts in open interest, and 11,800 strike price, which has accumulated 21.14 lakh contracts in open interest.
Put writing was seen at the 11,400 strike price, which added nearly 3.15 lakh contracts, followed by 11,800 strike, which added 2.2 lakh contracts and 11,500 strike which added 1.78 lakh contracts.
Put unwinding was seen at 12,000 strike price, which shed 2.79 lakh contracts, followed by 11,600 strike which shed 2.23 lakh contracts and 12,200 which shed 2.18 lakh contracts.
Stocks with a high delivery percentage
A high delivery percentage suggests that investors are showing interest in these stocks.
27 stocks saw long buildup
32 stocks saw long unwinding
Based on open interest (OI) future percentage, here are the top 10 stocks in which long unwinding was seen.
46 stocks saw short build-up
An increase in open interest, along with a decrease in price, mostly indicates a build-up of short positions. Based on open interest (OI) future percentage, here are the top 10 stocks in which short build-up was seen.
41 stocks witnessed short-covering
A decrease in open interest, along with an increase in price, mostly indicates a short covering. Here are the top 10 stocks that witnessed short-covering on January 8.
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Upcoming analyst or board meetings/briefings
Reliance Communications: Meeting of Committee of Creditors postponed, to be held on January 9.
Sterling and Wilson Solar: Company's officials will meet analysts/investors on January 9 and 10.
Shiva Cement: Board meeting is scheduled for January 14 to consider October-December results.
Alembic Pharma: Company will hold a post-results conference call on January 22.
Hindustan Media Ventures: Board meeting is scheduled for January 22 to consider October-December results.
Bharat Bijlee: Board meeting is scheduled for January 30 to consider October-December results.
Tata Global Beverages: Board meeting is scheduled on February 4 to consider October-December results.
TTK Prestige: Board meeting is scheduled for January 30 to consider October-December results.
Tejas Networks: Board meeting is scheduled for January 21 to consider October-December results.
HT Media: Board meeting is scheduled for January 23 to consider October-December results.
Tata Coffee: Analyst Call in respect of the financial results for Q3FY20 is scheduled to be held on January 29.
Affle India: Company's officials will meet SPA Securities and Emerge Capital on January 9, and Wasatch Advisors (US) and Edelweiss Broking on January 10.
Stocks in the news
Results on January 9: GTPL Hathway
Alembic Pharma: Aleor Dermaceuticals, a 60:40 JV with Orbicular Pharmaceutical Technologies, completed USFDA inspection at its formulation manufacturing facility located at Karakhadi, Gujarat, India; without any observations.
Aster DM Healthcare: Board meeting will be held on January 9 to consider share buyback.
RITES: Stock will trade ex-dividend on January 9.
SBI: Lender Launched 'Residential Builder Finance With Buyer Guarantee (RBBG)', to focus on affordable housing
Sunteck Realty: Chairman Rajnish Kumar said SBI signed MoU with the company for 3 projects under RBBG
HFCL: Company to buy 15% stake in Nivetti Systems for Rs 15.95 crore
Vedanta: Board approved raising up to Rs 2,000 crore via NCDs.
CSB Bank: Bank appointed BK Divakara as CFO w.e.f. February 5.
JSW Energy: CARE assigned the rating of 'AA-/Credit Watch with Negative implications'' for the company's Rs 300 crore Non-Convertible Debenture (NCD) issue.
FII and DII data
Foreign institutional investors (FIIs) sold shares worth Rs 515.85 crore, whereas domestic institutional investors (DIIs) bought shares of worth Rs 748.4 crore in the Indian equity market on January 8, provisional data available on the NSE showed.
Stock under F&O ban on NSEYes Bank is under the F&O ban for January 9. 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.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.