Overall, higher volatility suggests a bear grip but a cool off in VIX with a topping out formation could form a short-term bottom in the market
The Nifty ended a volatile session in the green on October 8 making a ‘Hammer’ like pattern on the daily charts. The index closed with gains of 31 points after shedding around 600 points in the last 4 sessions.
The Nifty bounced back from its crucial support placed at 10,200 levels. It reclaimed 10,300 levels on a closing basis and now as long as it holds above this level, the bounce should take the index toward 10,420, and 10,500 levels, suggest experts.
India VIX moved up by 2.12 percent at 20.15 levels but it slipped from its intraday swing high of 21.77 levels. Overall, higher volatility suggests a bear grip but a cool off in VIX with a topping out formation could form a short-term bottom in the market.
Technically, the crucial resistance is now placed at 10,500-11,000 levels and pullback towards the said level might face extensive selling pressure, suggest experts.
“The Nifty finally registered a ‘Hammer’ kind of formation. However, this intraday recovery largely appears to be on the back of few large-cap stocks which might have attracted lower level value buying,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.
“Hence, any pullbacks going forward shall remain vulnerable to unexpected selling pressure as multiple hurdles are placed on the way to 11,000 levels. In case this pull back materialises then the first hurdle shall remain around 10547 levels as market witnessed gap down opening in last Friday’s session,” he said.
Mohammad further added that some more strength can be expected on a close above 10,550 levels which may take the indices in the zone of 10,754 – 10,843 levels. On the way to downside corrective pattern completion still requires Nifty to slip below 9,950 levels.
We have collated the top 15 data points to help you spot profitable trades:
Key support and resistance level for Nifty
According to Pivot charts, the key support level is placed at 10,231.5, followed by 10,115.0. If the index starts moving upwards, key resistance levels to watch out are 10,431.4 and 10,514.8.
The Nifty Bank index closed at 24,618.3. The important Pivot level, which will act as crucial support for the index, is placed at 24,323.8, followed by 24,029.3. On the upside, key resistance levels are placed at 24,829, followed by 25,039.7.
Call Options Data
Maximum Call open interest (OI) of 28.81 lakh contracts was seen at the 10,800 strike price. This will act as a crucial resistance level for the October series.
This was followed by the 10,500 strike price, which now holds 27.13 lakh contracts in open interest, and 10,700, which has accumulated 25.56 lakh contracts in open interest.
Call writing was seen at 10,500 strike, which added 7.1 lakh contracts, followed by 10,400 which added 5.46 lakh contracts and 10,600 which added 3.93 lakh contracts.
Call unwinding was seen at the strike price of 10,900, which shed 1.42 lakh contracts.
Put Options data
Maximum Put open interest of 39.36 lakh contracts was seen at the 10,000 strike price. This will act as a crucial support level for the October series.
This was followed by the 10,500 strike price, which now holds 32.61 lakh contracts in open interest, and the 10,700 strike price, which has now accumulated 30.60 lakh contracts in open interest.
Put writing was seen at the strike price of 10,000, which added 1.01 lakh contracts in open interest, followed by 9,800 which added 0.49 lakh contracts and 9,900 strike which added 0.46 lakh contracts.
Put unwinding was seen at the strike price of 10,500, which shed 1.27 lakh contracts in open interest, followed by 10,600 which shed 52,063 contracts and 10,400 which shed 52,047 contracts.
FII & DII data
Foreign institutional investors (FIIs) sold shares worth Rs 1,805.07 crore while domestic institutional investors bought shares worth Rs 1,973.97 crore in the Indian equity market, as per provisional data available on the NSE.
Fund Flow Picture:
Stocks with high delivery percentage
High delivery percentage suggests that investors are accepting delivery of the stock, which means that investors are bullish on it.
26 stocks saw a long buildup
56 stocks saw short covering
A decrease in open interest along with an increase in price mostly indicates short covering.
60 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.
64 stocks saw long unwinding
Aksh Optifibre: Rathi Global Finance bought 10 lakh shares at Rs 23.13 apiece.
DHFL: Alphagrep Commodities traded 18.2 lakh shares at Rs 241.38-242.77 apiece.
Shaastra Securities Trading 45 lakh shares at Rs 240.7-240.78.
Eros International: Multiplier Share and Stock sold 5 lakh shares at Rs 75.35 apiece.
Infibeam: Sattva Organisers purchased 1.2 crore shares of the firm at Rs 60.
(For more bulk deals, click here)
Analyst or Board Meet/Briefings
Walchandnagar Industries: Representatives of the firm will be meeting financial and institutional investors between October 9 and October 11, 2018.
SRF: The company will meet investors in one-on-one or group meetings between October 10 and October 12, 2018 in Singapore and Hong Kong.
Shriram Transport: The company will be meeting Zaaba Capital in a call on October 9, 2018.
Finolex Industries: The management will be meeting representatives of Tata Mutual Fund on October 9, 2018.
Shalby: The company will be meeting APG Asset Management in Singapore on October 10, 2018.
Tata Steel: The firm met representatives of Silver Point Capital on October 8, 2018.
Stocks in news
Coal India: The firm and Neyveli Lignite sign MoU for formation of joint venture.
IL&FS Financial Services: The company has said that it will be unable to service obligations w.r.t inter-corporate deposit of Rs 20 crore due on October 8.
1 stock 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 October 9, IDBI is present in this list.