● In terms of price fluctuations:
After a positive opening near 22750, there was some profit-taking from the higher levels led by selling pressure in Reliance and IT stocks.
Nifty Bank witnessed a continuation of the positive momentum seen from last week with strong momentum seen in ICICIBANK yesterday and HDFCBANK firming closer to the 1560 resistance zone of the 200 DMA zone.
Sector indices such as real estate, metals, automobiles, financial services, infrastructure, and banking have shown relative strength, while IT, media, and FMCG are expected to continue to underperform. , momentum is expected to continue.
● From a global market perspective:
The dollar index is currently stable at around 104.15, which is positive in the short term.
The US 10-year yield is also trading around the 4.40% mark since the last few sessions.
Brent crude oil prices are currently trading close to $91 per barrel, which could be a real cause for concern from India’s perspective.
The US CPI data due tonight will be very important as it will be a key determinant of the Fed’s future policy actions.
Slowing inflation means the Fed could start cutting rates right away, while high inflation above 3.4% could mean the Fed plans to cut rates until inflation falls below acceptable levels. This means that it will be postponed for several more months.
● Main nifty levels:
Although the index is trending upward overall, it is important to be aware of the fact that the steady rise in Brent oil prices warrants some caution as Election Day approaches.
Therefore, going forward, you should maintain long positions keeping in mind the major support levels. Strong support lies around the March 2024 swing highs of 22480-22500 and the rally could extend to 22830-22870 levels until this zone holds. A sustained move above the 22870 level will lead to an extended rally towards 22980-23030 in the short term.
If the index falls below 22480, there will be further selling pressure on the index up to the 22350-22280 level.
● Interpretation of OI data
Nifty PCR is currently around 1.05 level, suggesting strength in the index.
Meaningful call writing was observed between 22700 and 22800 strikes, while significant put writing was observed between 22600 and 22500 strikes.
The overall range for the next few sessions could be 22,850 on the upside and 22,500 on the downside.
● Nifty level of major banks:
With HDFCBANK, ICICIBANK and Indusindbk showing volatility, the sentiment towards the banking index is very high and the texture has changed to buy on the bullshit. Also, over the past five days, the index witnessed the formation of a top-top-top-bottom pattern.
The current positive momentum is likely to extend towards the 49100-49250 zone until the index holds above the key support placed at the January 2024 swing high of 48300-48400.
If the index falls below 48250, there will be further selling pressure on the index up to the 47950-47800 level.
From the point of view of open interest,
Banknifty PCR is currently above 1.15 with notable call writing at strikes 48,800-49,000 and puts at 48,600, suggesting a range of 48,400-49,200 for the next few days.
● Momentum sectors and stocks:
from a wider market,
IciciBank, Apollo Hospital, Bajaj Finserv, BEL, AB Capital, Eicher Motors, Hind Copper, Nalco, Grasim, HAL, Icici Lombard, Policybzr, BEML, Castrol, MCX, Sail, Tata Power, Zomato also did well based on technical parameters. It looks similar to a relative strength chart.
● FII – DII data overview:
In the spot market,
FII sold up to 593 Cr and DII bought up to 2257 Cr.
FII index futures long-short ratio improved to 51% with 27,659 index futures purchased on a net basis.
On the equity futures side, FIIs bought 13637 contracts, while on the options side, FIIs bought 167901 call contracts and 162395 put option contracts.
