According to stock market experts, Dalal Street sentiment was dented after US FED meet and sharp depreciation of Indian National Rupee (INR) against the US dollar (USD). The pair USDINR sneaked above 81 level and that triggered selloff in banking stocks which was clearly mentioned in our previous weekly article.
Stock market today: Nifty, Bank Nifty outlook
"After remaining resilient against the global weakness in equities, Nifty gave in over the past three sessions. Nifty fell sharply for the second consecutive week (down 1.16%), breaking some key technical levels on the way. 17166 is the next support for the Nifty post which a sharper fall could ensue. 17490 could be the resistance for the Nifty in the near term," said Deepak Jasani, Head of Retail Research at HDFC Securities.
“Technically, Nifty has formed a ‘Lower Top Lower Bottom’ structure on the daily chart thus entering a downtrend and the banking and financial space which showed outperformance in last couple of months witnessed selling pressure and has ended below its ‘20 DEMA’ support. Apart from the above factors, FII’s position too does not bode well for our markets as they had started the September series with net short positions and have remained short throughout the series. They have now started selling in the cash segment as well and as we have seen in the recent past, their cash market selling along with short formations in derivatives markets usually have been catastrophic for the short term," said Ruchit Jain, Lead Research at 5paisa.com.
Ruchit Jain went on to add, “As far as levels are concerned, 17250 and 17165 are the immediate support levels for NSE Nifty on short term charts and as the momentum readings on the lower time frame chart are in oversold zone, a pullback move from around these supports could be seen. However, on the higher side 17540,17630 and 17700 would be the hurdle for Nifty index and markets could face selling pressure on pullback moves. On positional charts, until the data changes, one should continue to follow the trend and major support/target in this correction is placed around the ‘200 DEMA’ which is around 16880."
On Bank Nifty outlook, Mehul Kothari, AVP — Technical Research at Anand Rathi said, "Nifty Bank index was not able to surpass 42,000 mark. The negative divergence of RSI played its role and we witnessed a fall of over 2000 points in the index. Now along with the divergence we are witnessing fresh breakdown in RSI. In addition, there is a trend lien breakdown on the daily chart along with break of previous swing low of 40,200. Thus we are of the opinion that we could witness further fall in the index towards 38,500 to 38,000 mark in the coming week. The view would be negated only above 40,500 mark."
Nifty call put option data
On Nifty call put ratio, Shilpi Rout, Derivative Lead Analyst at Prabhudas Lilladher said, "Nifty Option chain for the weekly expiry reflects on PE writers active at 16000PE/17000PE - more than a lakh contracts, with aggressive PE OI unwinding seen across immediate ITM strikes. CE writers active at 17600/18000 strikes, with highest fresh additions of over 70 thousand contracts. Thus the data hints on the pain to continue for the index on the upside."
Bank Nifty call put option data
"Bank Nifty Future Option chain reflects on PE writers being active at 38000/39500 strikes - overall above 60 thousand contracts each, with CE writers continue to be active aggressively all the way up till at 40500/41000/415000 strikes - max exposures of more than a lakh contracts," said Shilpa rout.
Day trading stocks
On stocks to buy today, share market experts — Mehul Kothari of Anand Rathi; Ravi Singh, Vice President & Head of Research at Share India and Manoj Dalmia, Founder & Director at Proficient Equities — recommended 6 stocks to buy or sell today.
Mehul Kothari's stocks to buy today
1] ITC: Buy at ₹346, target ₹360, stop loss ₹340
2] Dabur: Buy at ₹568, target ₹590, stop loss ₹550
Ravi Singh's shares to buy today
3] VRL Logistics: Buy at ₹658, target ₹680, stop loss ₹650
4] Metropolis Healthcare: Buy at ₹1445, target ₹1490, stop loss ₹1420
Manoj Dalmia's stocks to buy or sell today
5] Adani Ports: Sell at ₹899, target ₹890, stop loss ₹904
6] IndusInd Bank: Sell at ₹1168, target ₹1156. stop loss ₹1175.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
