Trade setup for Friday: Top 15 things to know before the opening bell

Bulls dominated on weekly F&O expiry, taking the Nifty50 very close to much-awaited psychological 20,000-mark on July 20. Banking & financial services took the lead while supporting the market, along with FMCG stocks and index heavyweight Reliance Industries, while support was also seen from FIIs.

It was yet another record closing day for the market. The BSE Sensex rallied 475 points to 67,572, while the Nifty50 rose 146 points to 19,979 and formed long bullish candlestick pattern on the daily charts. Also, we saw the index making higher tops, higher bottoms for a sixth straight session.

"While market participants wait for a dip or consolidation, the bulls remain firmly in control, indicative of a strong ongoing bull trend. From a technical standpoint, there are no signs of weakness, but it's crucial to remain vigilant as markets have a tendency to surprise participants off guard," Rajesh Bhosale, technical analyst at Angel One said.

He further said it would be wise to wait for some consolidation or profit booking before entering long positions as the market is in a super bull trend.

He feels the golden retracement target for the Nifty is around 20,100 – 20,200, posing an immediate obstacle, while with the recent vertical move, the immediate support is placed around the 19,750 – 19,650 zone. Traders should closely monitor these levels and consider playing within this range, he advised.

Future open interest (OI) data also showed long build-up in five out of the previous six trading sessions, indicating strong buying interest. Nifty moved from 19,711 on July 17 to 19,979 on July 20, but the Put-Call Ratio (PCR) fell from 1.44 to 1.40 during the same period, signalling that the Put writers are not very comfortable adding positions at higher levels, Ashwin Ramani, derivatives & technical analyst at SAMCO Securities said.

Key support, resistance levels on Nifty

The pivot point calculator suggests that the Nifty may get support at 19,821 followed by 19,766 and 19,676. In case of an upside, 19,999 can be a key resistance area followed by 20,054 and 20,143.

Nifty Bank

On July 20, the Bank Nifty maintained upward journey and hit fresh all-time high of over 46,000 mark. The index rose 518 points or 1.13 percent to end at record closing high of 46,187 and formed bullish candlestick pattern on the daily timeframe.

"Bank Nifty witnessed a breakout from the Inside Bar pattern on the upside and also witnessed follow-through buying interest. The daily and the hourly momentum indicators also have a positive crossover," Jatin Gedia, technical research analyst at Sharekhan by BNP Paribas said.

Thus, he feels both price and momentum indicators are suggesting a continuation of the upmove and expects the Bank Nifty to target levels of 46,500.

The pivot point calculator indicates that the Bank Nifty is likely to take support at 45,793, followed by 45,648 and 45,413, while 46,263 can be the initial resistance zone followed by 46,408 and 46,643.

Call options data

The maximum weekly Call open interest (OI) remained at 20,000 strike, with 1.56 crore contracts, which can act as a resistance for the Nifty in the coming sessions.

This is followed by 62.48 lakh contracts at 20,100 strike, while 20,300 strike has 58.26 lakh contracts.

Meaningful Call writing was seen only at 20,000 strike, which added 27.08 lakh contracts.

Maximum Call unwinding was at 19,900 strike, which shed 71.84 lakh contracts; followed by 19,800 and 20,100 strikes, which shed 50.25 lakh and 14.83 lakh contracts respectively.

Put option data

On the Put side, the maximum open interest was at 19,900 strike, with 79.68 lakh contracts, which could be an important support for the Nifty.

This was followed by the 19,700 strike, comprising 65.46 lakh contracts, and the 19,800 strike, which had 62.33 lakh contracts.

Put writing was seen at 19,900 strike, which added 64.99 lakh contracts, followed by 20,000 and 20,100 strikes, which added 39.33 lakh and 1.25 lakh contracts, respectively.

We have seen Put unwinding at 19,800 strike, which shed 44.99 lakh contracts, followed by 19,500 and 19,600 strikes, which shed 42.02 lakh contracts and 34.78 lakh contracts, respectively.

Stocks with high delivery percentage

A high delivery percentage suggests that investors are showing interest in the stock. The highest delivery was seen in Bata India, Gujarat Gas, Godrej Consumer Products, Navin Fluorine International, and Reliance Industries among others.

57 stocks see a long build-up

IndiaMART InterMESH, ICICI Lombard General Insurance Company, Balrampur Chini Mills, Can Fin Homes, and Bharti Airtel were among the 57 stocks to see a long build-up based on the open interest (OI) percentage. An increase in open interest and price indicates a build-up of long positions.

30 stocks see long unwinding

Based on the OI percentage, 30 stocks, including Reliance Industries, Havells India, Bosch, L&T Finance Holdings, and Tata Communications saw a long unwinding. A decline in OI and price indicates a long unwinding.

57 stocks see a short build-up

A short build-up was seen in 57 stocks, including Container Corporation of India, Coforge, ABB India, Cummins India, and Shree Cements. An increase in OI along with a price fall indicates a build-up of short positions.

42 stocks see short-covering

Based on the OI percentage, 42 stocks were on the short-covering list. These included Polycab India, Federal Bank, Dr Lal PathLabs, Kotak Mahindra Bank, and LIC Housing Finance. A decrease in OI along with a price increase is an indication of short-covering.

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Results on July 21 and July 22

Infosys: The country's second-largest IT services provider recorded net profit at Rs 5,945 crore for quarter ended June FY24, down 3 percent compared to previous quarter and slashed full year revenue growth guidance to 1-3.5 percent from 4-7 percent earlier while maintaining EBIT margin guidance at 20-22 percent. Revenue grew by 1.3 percent sequentially to Rs 37,933 crore, while dollar revenue rose by 1.4 percent QoQ to $4,617 million and revenue growth in constant currency terms stood at 1 percent against CNBC-TV18 poll estimates of 0.7 percent rise.

Hindustan Unilever: The FMCG major registered a 6.1 percent year-on-year growth in revenue at Rs 15,148 crore and 8 percent on-year growth in profit at Rs 2,472 crore for quarter ended June FY24, with growth in all key segments - home care, beauty & personal care, and foods & refreshment. On the operating front, EBITDA grew by 8.4 percent to Rs 3,521 crore with margin expansion of 50 bps at 23.2 percent compared to year-ago period. The underlying volume growth stood at 3 percent for the quarter, which was lower than CNBC-TV18 poll estimates of 5-6 percent.

Larsen & Toubro: The engineering and infrastructure major said the board of directors will meet on July 25 to consider the buyback of equity shares of the company, and special dividend for the financial year 2023-24. If approved, the record date for determining the entitlement of the equity shareholders for the said dividend will be August 2.

Jindal Stainless: The country's largest stainless steel manufacturing company has completed the acquisition of Jindal United Steel. Earlier, the company held 26 percent stake in Jindal United Steel, and now it has acquired the remaining 74 percent equity stake in Jindal United Steel for a cash consideration of Rs 958 crore. With this, Jindal United Steel becomes a 100-percent subsidiary of Jindal Stainless.

Utkarsh Small Finance Bank: The small finance bank shares will list on the bourses on July 21. The issue price has been fixed at Rs 25 per share.

LTIMindtree: The technology consulting and digital solutions company has announced strategic partnership with CYFIRMA, an external threat landscape management platform company, to enhance the threat intelligence capabilities of its XDR platform and help global enterprises identify, evaluate, and manage potential risks and threats.

Hindustan Aeronautics: The state-owned defence major and Argentina have signed a Letter of Intent (Lol) on productive cooperation and acquisition of light and medium utility helicopters for the armed forces of the Argentine Republic.

Persistent Systems: The Pune-based IT company has reported net profit at Rs 228.8 crore for the quarter ended June FY24, a drop of nine percent compared to previous quarter, dented by weak operating performance. Revenue in rupee terms grew by three percent QoQ to Rs 2,321.2 crore and topline in dollar terms also increased by three percent to $282.90 million for the quarter.

FII and DII data

Foreign institutional investors (FII) have bought shares worth Rs 3,370.90 crore, whereas domestic institutional investors (DII) sold shares worth Rs 193.02 crore on July 20, provisional data from the National Stock Exchange (NSE) shows.

The NSE has added Balrampur Chini Mills, and Punjab National Bank to its F&O ban list for July 21, while retaining Delta Corp, Indiabulls Housing Finance, L&T Finance Holdings, Manappuram Finance, and RBL Bank. Securities banned under the F&O segment include companies where derivative contracts have crossed 95 percent of the market-wide position limit.