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Earnings, macro data, F&O expiry in focus this week; support for Nifty at 18,000-17,950: Experts

We expect choppiness to continue due to the scheduled monthly expiry and prevailing earnings season. On the macroeconomic front, the core sector data will be released on October 29, says Ajit Mishra, VP Research. Religare Broking.

October 25, 2021 / 08:18 AM IST
In the week gone by, the market lost the last two-week's gaining momentum and ended lower amid high volatility despite hitting fresh record highs, dragged by selling seen in the mid and smallcap stocks. In the past week, BSE Sensex fell 484.33 points (0.79 percent) to close at 60,821.62, while the Nifty50 declined 223.65 points (1.21 percent) to close at 18,114.9 levels.
In the week gone by, the market lost the last two-week's gaining momentum and ended lower amid high volatility despite hitting fresh record highs, dragged by selling seen in the mid and smallcap stocks. In the past week, BSE Sensex fell 484.33 points (0.79 percent) to close at 60,821.62, while the Nifty50 declined 223.65 points (1.21 percent) to close at 18,114.9 levels.
Vijay Dhanotiya, Lead Technical Research at CapitalVia Global Research | Our research suggests that 18000 will be an important support level for the market. If the market is able to sustain the level of 18000, we can witness a reversal in the market. We have observed the momentum indicators like RSI and MACD indicating signs of reversal in the market.
Vijay Dhanotiya, Lead Technical Research at CapitalVia Global Research | Our research suggests that 18,000 will be an important support level for the market. If the market is able to sustain that, we can witness a reversal in the market. We have observed the momentum indicators like RSI and MACD indicating signs of reversal in the market.
Rohit Singre, Senior Technical Analyst at LKP Securities | The index has formed consecutive bearish candles throughout last week which hints bears are trying to grip the market from higher levels & which will be possible if we drag below the 18k mark in the coming week. Immediate supports for Nifty is coming near the 18k mark followed by 17950 zone and if index managed to hold above 18k mark, one can expect a swift pullback & resistance is coming near 18250-18350 zone.
Rohit Singre, Senior Technical Analyst at LKP Securities | The index has formed consecutive bearish candles throughout the past week, which hints bears are trying to take over the market from higher levels. It is likely if we go below the 18k mark in the coming week. Immediate support for Nifty is near the 18k mark followed by 17950 zone and if index managed to hold above 18k mark, one can expect a swift pullback. Resistance is near 18250-18350 zone.
Mohit Nigam, Head - PMS, Hem Securities | Immediate support for Nifty 50 is 18,000. According to our analysis if the market is able to sustain the level of 18000 then we can see a reversal in the market. We believe market direction in the near term will depend on Q2FY22 earnings and their management commentary, demand in festive seasons and commodity prices.
Mohit Nigam, Head - PMS, Hem Securities | Immediate support for Nifty 50 is 18,000. According to our analysis if the market is able to sustain the level of 18000 then we can see a reversal in the market. We believe market direction in the near term will depend on Q2FY22 earnings and their management commentary, demand in festive seasons and commodity prices.
Ajit Mishra, VP Research. Religare Broking | We expect choppiness to continue due to the scheduled monthly expiry and prevailing earnings season. On the macroeconomic front, the core sector data will be released on October 29. There will be some buzz in the primary market too, with FSN E-Commerce Ventures IPO, operator of Nykaa beauty stores, opening for subscription from Oct 28. Besides, global cues especially updates related to the COVID situation will be in focus. Going ahead, earnings will continue to dictate the market trend, in absence of any major event. On the index front, Nifty has critical support at 17,950 and its breakdown may result in a further slide towards 17,650. The recent buoyancy in the banking pack is certainly encouraging and it may play a crticial role in the rebound in the index. The 18,200-18,400 zone would act as an immediate hurdle in case of any bounce. We’re seeing sharp cuts in the broader segment so traders should prefer index majors over others. Investors, on the other hand, should utilize this phase to gradually add fundamentally sound counters.
Ajit Mishra, VP Research. Religare Broking | We expect choppiness to continue due to the scheduled monthly expiry and prevailing earnings season. On the macroeconomic front, the core sector data will be released on October 29. There will be some buzz in the primary market too, with FSN E-Commerce Ventures IPO, operator of Nykaa beauty stores, opening for subscription from Oct 28. Besides, global cues, especially updates related to the COVID situation will be in focus. Going ahead, earnings will continue to dictate the market trend, in absence of any major event.
Palak Kothari, Research Associate at Choice Broking | On a technical front, the index has been trading with lower highs and lower low formation for the last four days, which points out weakness in the counter. However, on an hourly chart, the index has taken support from the middle band of bollinger formation, which suggests bounce-back movement can be expected. Hourly momentum indicator, stochastic has been bounced from oversold zone and divergence has been seen which points out upside movement can be seen in the index. At present, the Index has immediate support at 18000 level while resistance comes at 18380 levels.
Palak Kothari, Research Associate at Choice Broking | On a technical front, the index has been trading with lower highs and lower low formation for the last four days, which points out weakness in the counter. However, on an hourly chart, the index has taken support from the middle band of bollinger formation, which suggests bounce-back movement can be expected. Hourly momentum indicator, stochastic has been bounced from oversold zone and divergence has been seen which points out upside movement can be seen in the index. At present, the Index has immediate support at 18000 level while resistance comes at 18380 levels.
Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One | As far as levels are concerned, 18060 – 18000 are to be considered as crucial supports; whereas on the flipside, 18260 – 18400 would be seen as immediate hurdles. Since the weekly chart of midcap index is showing a bearish formation, which can be termed as ‘Engulfing’ candle; we advise traders not to create aggressive longs in high beta counters. Yes the thematic approach can still be followed, but one needs to be very selective now. Below 18000 for Nifty, the near term uptrend gets negated and then we are up for some correction which is overdue since a long time.
Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One | As far as levels are concerned, 18060 – 18000 are to be considered as crucial supports; whereas on the flipside, 18260 – 18400 would be seen as immediate hurdles. Since the weekly chart of midcap index is showing a bearish formation, which can be termed as ‘Engulfing’ candle; we advise traders not to create aggressive longs in high beta counters. Yes the thematic approach can still be followed, but one needs to be very selective now. Below 18000 for Nifty, the near term uptrend gets negated and then we are up for some correction which is overdue since a long time.
Santosh Meena, Head of Research, Swastika Investmart | Technically, Nifty formed a dark cloud cover candlestick formation on the weekly chart which is a sign of a short-term reversal but we have to wait for follow-up for confirmation. On the daily chart, it is trading near the critical support zone of 18000-17950 zone where we can expect a bounceback. On the upside, 18250-18300 will be the immediate supply zone while 18400-18450 will be the next resistance zone. If Nifty slips below the 17950 level then there is a risk of any meaningful correction where 17600 will be the next important support level. If we talk about the cues for the next week then the next batch of earnings season and October month F&O expiry may cause volatility in the market. The market will react to earnings of Reliance industries and ICICI bank on Monday.
Santosh Meena, Head of Research, Swastika Investmart | Technically, Nifty formed a dark cloud cover candlestick formation on the weekly chart which is a sign of a short-term reversal but we have to wait for follow-up for confirmation. On the daily chart, it is trading near the critical support zone of 18000-17950 zone where we can expect a bounce back. On the upside, 18250-18300 will be the immediate supply zone while 18400-18450 will be the next resistance zone. If Nifty slips below the 17950 level then there is a risk of any meaningful correction where 17600 will be the next important support level. If we talk about the cues for the next week then the next batch of earnings season and October month F&O expiry may cause volatility in the market. The market will react to earnings of Reliance industries and ICICI bank on Monday.
Vinod Nair, Head of Research at Geojit Financial Services | Indian markets were impacted due to muted Q2 results which were weaker than forecasted due to high input cost. However, on a positive note, the long-term market trend is intact due to further re-opening of the economy, low interest cycle and fiscal & private spending. In the week ahead, domestic markets will continue to track Q2 results for further direction. Any further inconsistency, as seen in recent numbers, can lead to further fall in the short-term.
Vinod Nair, Head of Research at Geojit Financial Services | Indian markets were impacted due to muted Q2 results which were weaker than forecasted due to high input cost. However, on a positive note, the long-term market trend is intact due to further re-opening of the economy, low interest cycle and fiscal & private spending. In the week ahead, domestic markets will continue to track Q2 results for further direction. Any further inconsistency, as seen in recent numbers, can lead to further fall in the short-term.
Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services | The market consolidation is likely to continue in near term given weak global cues and mixed earnings so far – affected by cost inflationary pressure and supply side issues on margin. With skyrocketing valuations, many stocks prices have moved beyond comfort zone thus leaving very little margin of safety. On Monday investors would react to Reliance and ICICI Bank results along with global cues. We would suggest traders to stay safeguarded, while investors should adopt cash deployment in staggered fashion.
Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services | The market consolidation is likely to continue in near term given weak global cues and mixed earnings so far – affected by cost inflationary pressure and supply side issues on margin. With skyrocketing valuations, many stocks prices have moved beyond comfort zone thus leaving very little margin of safety. On Monday investors would react to Reliance and ICICI Bank results along with global cues. We would suggest traders to stay safeguarded, while investors should adopt cash deployment in staggered fashion.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities | We are of the view that for positional traders 20 day SMA or 17950 would be the key support level. On the flip side, 18300 and 18425 may act as a decisive resistance level. For day traders, 18050 would be the sacrosanct support level and above the same, a pullback rally could be seen up to 18300-18350 levels. On the flip side, dismissal of 18050 could trigger one more leg of correction up to 18000-17975. Contra traders can take a long bet between 17975 to 17950 with a strict support stop loss at 17900. Meanwhile, the Bank Nifty has continued promising breakout continuation formation. According to daily charts, the key support levels for Bank Nifty are placed at 39200 and 38800, and the structure suggests further upside if it succeeds to trade above 39200.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities | We are of the view that for positional traders 20 day SMA or 17950 would be the key support level. On the flip side, 18300 and 18425 may act as a decisive resistance level. For day traders, 18050 would be the sacrosanct support level and above the same, a pullback rally could be seen up to 18300-18350 levels. On the flip side, dismissal of 18050 could trigger one more leg of correction up to 18000-17975. Contra traders can take a long bet between 17975 to 17950 with a strict support stop loss at 17900. Meanwhile, the Bank Nifty has continued promising breakout continuation formation. According to daily charts, the key support levels for Bank Nifty are placed at 39200 and 38800, and the structure suggests further upside if it succeeds to trade above 39200.
Yesha Shah, Head of Equity Research, Samco Securities | The market may struggle to hold its footing next week and is likely to stay range-bound. After exceeding the 40,000 mark for the first time this week, Bank Nifty is likely to be in the limelight in the next week as various banks announce their results. Given the improvement in economic activity, enhanced collection efficiency and stabilized asset quality, a favorable earnings outlook from this industry can be expected. Furthermore, with the monthly expiry coming up next week, market volatility may linger.
Yesha Shah, Head of Equity Research, Samco Securities | The market may struggle to hold its footing next week and is likely to stay range-bound. After exceeding the 40,000 mark for the first time this week, Bank Nifty is likely to be in the limelight in the next week as various banks announce their results. Given the improvement in economic activity, enhanced collection efficiency and stabilized asset quality, a favorable earnings outlook from this industry can be expected. Furthermore, with the monthly expiry coming up next week, market volatility may linger.
Rakesh Patil
first published: Oct 25, 2021 08:18 am

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