Trade Setup for Today: Expect Consolidation in Nifty with Support at 22,300-22,000 Levels
The Nifty formed a long bearish candlestick pattern yesterday, indicating a potential reversal from the recent bullish trend. According to Nagaraj Shetty of HDFC Securities, this pattern typically signals a retracement from higher levels in the short term. He believes that the short-term momentum of Nifty is weak, with the next support level around 22,100-22,050
Trade Setup for Today: Expect Consolidation in Nifty with Support at 22,300-22,000 Levels
Trade Scenario:
The market started the week with a negative bias, but experts suggest that this could be a normal profit-taking after recent gains. With support around 22,300-22,000 levels, consolidation in Nifty is expected in the coming days. On the upside, the first resistance is seen at 22,500. If this barrier is surpassed, Nifty could witness further upside towards 22,600-22,800 levels.
Market Analysis:
On March 11, the BSE Sensex closed 617 points lower at 73,503, while the Nifty 50 index ended 161 points down at 22,333. The formation of a long bearish candlestick pattern by Nifty suggests a potential reversal from the recent uptrend.
Nagaraj Shetty’s View:
According to Nagaraj Shetty of HDFC Securities, the chart pattern indicates that the market may experience temporary weakness. However, the short-term technical structure of the market remains positive.
Support and Resistance Levels:
For Nifty, the first resistance is at 22,353, followed by significant resistances at 22,524 and 22,608. On the downside, support levels are at 22,305, 22,253, and 22,169.
Bank Nifty Analysis:
For Bank Nifty, the first resistance is at 47,385, followed by significant resistances at 47,856 and 48,094. On the downside, support levels are at 47,233, 47,086, and 46,848.
Option Data:
The open interest at the 23,000 strike call option suggests it could be a significant resistance level in the upcoming sessions. The 22,000 strike call option witnessed the most unwinding.
Delivery Percentage Leaders:
Stocks with high delivery percentages indicate investor interest. Hindustan Unilever, InterGlobe Aviation, JK Cement, HDFC Bank, and Shriram Finance witnessed the highest delivery percentages.
Long Build-up:
Stocks showing an increase in open interest and price indicate long positions being built. InterGlobe Aviation, Siemens, ICICI Prudential Life Insurance Company, Zydus Lifesciences, and MRF witnessed a long build-up.
Short Covering:
Stocks showing a decrease in open interest and a price increase suggest short covering. Tata Chemicals, Mahanagar Gas, SAIL, ICICI Lombard General Insurance Company, and Bharti Airtel witnessed short covering.
Short Build-up:
Stocks showing an increase in open interest and a price decrease indicate short positions being built. Apollo Tyres, PVRINOX, Aditya Birla Fashion & Retail, Tata Steel, and Dr Lal PathLabs witnessed a short build-up.
Put Call Ratio (PCR):
The PCR, an indicator of market sentiment decreased to 0.94 from 1.27 in the previous session. A PCR above 1 suggests more buying of put options than call options, indicating a bearish sentiment.
Conclusion
the market will likely witness consolidation with support around 22,300-22,000 levels in Nifty. Traders should monitor key support and resistance levels along with option data and delivery percentages for trading opportunities.
READ MORE-HDFC Bank Shareholders Stunned as CLSA Unveils Downgrade and Lowered Target Price