The Nifty50 after opening flat traded rangebound throughout the session but started correcting gradually in late morning deals. It fell below psychological 11,700-mark in the last half an hour of trade and closed tad below the same level on Wednesday.
The index formed bearish candle on the daily candlestick charts ahead of expiry of August futures & options contracts on Thursday.
But the broader markets outperformed frontline indices with the Nifty Midcap index rising half a percent while the sectoral trend was mixed with the Nifty Metal, PSU Bank and Realty indices climbing over a percent each.
The Nifty50 opened at 11,744.95 and closed at 11,691.90. In the morning, the index after flat opening dipped and immediately bounced back to hit an intraday high of 11,753.20 followed by volatility. It started correcting gradually in late morning deals and hit a day’s low of 11,678.85 in late trade. The index closed 46.60 points lower at 11,691.90.
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After today’s correction, the index is likely to correct further and if it breaks 11,600 levels then major fall is likely, experts said, adding the volatility is likely to be high on Thursday due to expiry of August futures & options contracts.
“Nifty50 filled the bullish gap registered in Tuesday’s session before signing off the day with a Bearish Candle suggesting impending weakness in the markets,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.
He said this weakness shall get materialised on a close below 11,600 levels which should also ideally confirm short term trend reversal as such a close not only result in the breakdown of ascending channel in which Nifty50 is moving for last 42 sessions but also breaches the short term moving averages which propped up the prices higher in the past during corrective phases.
Hence, it looks inevitable for bulls to register a close above 11,760 levels to reinstate the bullish sentiment and till then market shall remain vulnerable for a short term trend reversal in favour of bears, he added.
Hence, traders are advised to remain on sidelines and wait for clear cut directional clues before initiating fresh bets, he advised.
Vikas Jain, Senior Research Analyst, Reliance Securities said Nifty 11,800 CE (Call option) has witnessed buildup with open interest increasing by 7.4 lakh shares to approximately 34 lakh shares.
He believes on Thursday the market in the last one hour of trade will be very volatile with respect to the expiry day as the market is already up by 4.7 percent in August series.
Auto stocks will be in focus post expiry as monthly sales numbers would start trickling in the weekend, he feels. “One may look to initiate long in auto, private banks and high quality mid-cap stocks for reasonable upside, as the risk reward looks favourable at current levels.”
We have collated the top 15 data points to help you spot profitable trades:
Key support and resistance level for Nifty
The Nifty closed at 11,691.90 on Wednesday. According to Pivot charts, the key support level is placed at 11,662.73, followed by 11,633.57. If the index starts moving upwards, key resistance levels to watch out are 11,737.13 and 11,782.37.
Nifty Bank
The Nifty Bank index closed at 28,224.10, down 45.55 points on Wednesday. The important Pivot level, which will act as crucial support for the index, is placed at 28,146.57, followed by 28,069.04. On the upside, key resistance levels are placed at 28,322.87, followed by 28,421.63.
Call Options Data
Maximum call open interest (OI) of 31.82 lakh contracts was seen at the 11,800 strike price. This will act as a crucial resistance level for August series.
This was followed by the 11,700 strike price, which now holds 23.21 lakh contracts in open interest, and 11,900, which has accumulated 17.46 lakh contracts in open interest.
Call writing was seen at the strike price of 11,800, which added 5.28 lakh contracts, followed by 11,900 which added 3.16 lakh contracts and 11,700 which added 2.46 lakh contracts.
Highest Call unwinding was seen at the strike price of 11,500, which shed 5.26 lakh contracts, followed by 11,600, which shed 4.59 lakh contracts and 11,400 which shed 4.47 lakh contracts.
Put Options data
Maximum put open interest of 30.08 lakh contracts was seen at the 11,500 strike price. This will act as a crucial support level for August series.
This was followed by the 11,600 strike price, which now holds 27.97 lakh contracts in open interest, and the 11,200 strike price, which has now accumulated 29.78 lakh contracts in open interest.
There was hardly any Put writing seen.
Highest Put unwinding was seen at the strike price of 11,700, which shed 11.28 lakh contracts, followed by 11,400 which shed 6.16 lakh contracts and 11,300 which shed 4.81 lakh contracts.
FII & DII data
Foreign institutional investors (FIIs) sold shares worth Rs 1,415.87 crore while domestic institutional investors bought shares worth Rs 1,114.36 crore in the Indian equity market on Wednesday, 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.
45 stocks saw long buildup
72 stocks saw short covering
A decrease in open interest along with an increase in price mostly indicates short covering.
47 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.
42 stocks saw long unwinding
Bulk Deals
Deep Polymers: NNM Securities bought 1,26,000 shares of the company at Rs 40.3 per share on the BSE.
(For more bulk deals, click here)
Analyst or Board Meet/Briefings
Reliance Infrastructure: Analysts meet on completion of 100 percent sale of its Integrated Mumbai Power Distribution Business to Adani Transmission Limited will be held on August 30.
Minda Corporation: Company has issued the Commercial Paper of Rs 25 crore. This is in line with the management efforts to bring down the cost of the company.
Natural Capsules: 25th Annual General Meeting of the members will be held on September 21.
Pioneer Distilleries: 25th Annual General Meeting of the members will be held on September 21.
Blue Star: Company’s officials are meeting analysts at IIFL Conference on September 3 and IIFL Roadshow on September 4 in London.
Capacite Infraprojects: 6th Annual General Meeting of the company scheduled to be held on September 3.
Zen Technologies: 25th Annual General Meeting of the company will be held on September 29.
Piramal Enterprises: Company is organising Financial Services Day for analysts / investors in Mumbai on August 30.
Mahindra Lifespace Developers: Company’s officials are meeting analysts Andy Draycott and Abhinav Mehra of Coupland Cardiff Asset Management on August 30.
Karnataka Bank: The meeting of the board of directors of the bank has been scheduled on September 5 to consider the proposal for augmenting the capital through Tier II instruments.
Magma Fincorp: Company’s officials are meeting Edelweiss Wealth Research Team on August 30; Baroda Pioneer MF, Birla PMS, Karvy PMS and ITI Group in Karvy Conference on August 31; and Valium Capital and ICICI Prudential Asset Management on August 31.
Shemaroo Entertainment: Company’s officials are meeting Pabrai Investment Funds and Emkay Global Financial Services on August 30.
Khaitan Electricals: Annual General Meeting is scheduled to be held on Saturday September 29.
Adani Ports and Special Economic Zone: Company’s officials are meeting with equity investors on September 4 and 5 in Hong Kong.
Prime Securities: 35th Annual General Meeting will be held on September 24.
Vishal Fabrics: 33th Annual General Meeting of the members of the company will be held on September 20.
Container Corporation of India: Company’s officials are meeting analysts/investors on September 6, 17 and 18, and November 15.
India Energy Exchange: Company’s officials are meeting analysts/investors on August 30, September 3, 6, 7, 10 and 14.
MOIL: 56th Annual General Meeting of the company will be held on September 27.
Coffee Day Enterprises: 10th Annual General Meeting of the company will be held on September 27.
Hinduja Ventures: 33rd Annual General Meeting of the company will be held on September 24.
Tilaknagar Industries: 83rd Annual General Meeting of the company will be held on September 22.
CRISIL: Company’s officials are meeting APG, Asset Management and Invesco on September 3 and 5 respectively.
Man Infraconstruction: The meeting of board of directors of the company will be held on September 1 to consider declaration of Interim dividend for the financial year 2018-19.
Power Finance Corporation: The meeting of the board of directors of the company is scheduled on September 11 to consider unaudited financial results for the quarter ended June.
IFCI: The meeting of the board of directors of the company is scheduled on September 8 to consider unaudited financial results for the quarter ended June.
Stocks in news
Mahindra Logistics: Board approved the appointment of Yogesh Patel, VP – Finance of the company, as the CFO and KMP of the company, with effect from September 1.
Amtek Auto: Q3FY18 loss at Rs 80.21 crore against loss of Rs 241.56 crore in Q3FY17 and loss of Rs 10,652.2 crore in Q2FY18. Revenue at Rs 313.77 crore against Rs 457.2 crore in Q3FY17 and Rs 343.62 crore in Q2FY18.
Unitech: Q1FY19 loss at Rs 72.95 crore against loss Rs 16.47 crore; revenue falls to Rs 76.3 crore versus Rs 195.96 crore (YoY).
PTC India Financial Services: Q1 profit falls to Rs 55.93 crore versus Rs 72.4 crore; provisions and contingencies rose to Rs 17.11 crore versus Rs 14.23 crore (YoY).
Tata Chemicals: ICICI Prudential Life Insurance sold 52,13,678 shares of the company at an average price of Rs 414.21 per share which were worth Rs 216 crore. Its stake in the company reduced to 2.97 percent from 5.02 percent earlier.
Vedanta’s subsidiary Electrosteel Steels: Q4FY18 loss at Rs 5,272.35 crore against loss of Rs 293.33 crore; revenue rises to Rs 1,149.03 crore against Rs 676.15 crore (YoY).
Greaves Cotton: Board has approved the proposal of investment in Ampere Vehicles Private Limited, to acquire 67 percent in the first phase and further 13 percent in a span of three years.
Laurus Labs: Company receives USFDA approval for Metformin Hydrochloride tablets which are used for treatment of diabetes.
Celestial Biolabs: The meeting of the board of directors of the company is scheduled on September 3 to consider the further issue of equity shares and/or warrants to promoters and non-promoters group on preferential basis.
Reliance Infrastructure: Company completed 100 percent sale of its Integrated Munibai Power Distribution Business to Adani Transmission.
National Fertilizers (NFL): Ramagundam Fertilizers & Chemicals Limited (RFCL) is a joint venture company promoted by NFL, EIL and FCIL to revive old FCIL plant at Ramagundam in Telangana. The plant is likely to start commercial production by the year 2019. NFL has signed Memorandum of Agreement (MoA) with RFCL to market RFCL Products including 12.71 LMT urea to be produced by RFCL plant at Ramagundam.
Raj Agro Mills: Change of Name from Raj Agro Mills to PAOS Industries.
3 stocks 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 August 30, DHFL, IDBI Bank and Punjab National Bank are present in this list.