14th Jan' 2022 (Evening)

14th Jan' 2022 (Evening)   --  | Written on 16th Jan' 2022 at 5.00 PM |

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  • Indices opened gap down on Friday and then slid further to test their support levels. Bank Nifty specially tested its support at 38025 that i mentioned in my notes on Thu and Nifty made a low of 18119, while i mentioned the support of Nifty at 18000.
  • However, both indices recovered from their lows and then made a second dip to retest the above levels, but then made a strong recovery to close strong and made bullish candles on the daily chart.
  • Nifty
    • Support
      • First support at 18125
      • Second support at 18000
    • Resistance
      • First resistance at 18300
      • Second resistance at 18450
  • Bank Nifty
    • Support
      • First support at 38000
      • Second support at 37425
    • Resistance
      • First resistance at 38450
      • Second resistance at 38750
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  • Price action vise Bank Nifty has already tested a critical support at 38000 on Friday, so a breach of this support could slide it deeper to 37500 levels. However, the price action was distorted due to the results of HDFC Bank expected on Sat. Now after a good set of number from the Bank, market would react to it tomorrow. Bank Nifty could see some volatility because of this. I expect a positive move as the other banks could pick some leads from it.
  • With a strong earning growth, market may see it positively, though the revenue growth was not as expected by the market, so this may still not provide the required boos to the Index is what I feel.
  • Generally the sentiment across the street should be good with a good set of results from two market heavy weights, The IT Pack and HDFC Bank,
  • Omicron is easing out now, with countries like Spain and UK already easing out restrictions. I feel more countries should follow the trend.
  • FII however, sold for ~1600Cr on Friday and also unwound some longs on Index futures. They shorted a large number of calls as well. Though hedging them in case of a trouble. 
  • I feel the markets could turn out to be volatile in short term, and would maintain a bullish bias, till my support of 18000 on Nifty and 38000 on Bank Nifty is respected. Buy all dips till these levels is what I would advice.
  • Dollar Index is now continuing to be below 95.5, this level should now be its resistance. This is good for us. Yields on the other side are hovering between 1.7 and 1.8 as of now. I do not see that as a concern.
  • Oil is a concern and is rising fast again. Would be a reason for Inflation and is a show spoiler.
  • Options OI indicate support at 18200 and 38000 respectively. So keep your longs and hold tight.
  • Economic events this week are :
    • Mon - Chinese GDP and Industril production
    • Tue - British Earnings Index and German economic sentiment
    • Wed - British CPI and and US Building permit data
    • Thu - US Jobless claims
  • Results - Mon - Ultratech cement Thu - HUL, Asian Paints and Fri - Reliance

1. FII were net sellers for 1598 Cr today, while DII were buyers for 371 Cr. A net selling of 1227 Cr from the institutional side.

2. FII's unwound 6516 longs and created 330 shorts on the index futures

3. On the option front FII  sold 98720 calls and   sold 47504 puts. They also bought 126292 calls and  biught 76409 Puts.

4. For next week expiry, Nifty has the highest OI for PE at 18200 followed by 18000 and highest OI for CE is at 18200 followed by 18800. Highest Put writing was seen at 18200 and highest call writing was seen at 18200-18800 levels.

5. For the next week expiry, Bank Nifty has the highest OI for PE at 38000 followed by 37500 and highest OI for CE is at 38500 followed by 39000. Highest Put writing was seen at 38000 and highest call writing was seen at 39500 levels. 

6. Asian markets closed mostly in red and Europes closed in red.

7. US markets closed mixed with Dow in red and Nasdaq in green

8. The breadth of the market was strong  today

9. Nifty opened at 18185 and made an intra day high of 18286 and a low of 18119 before closing at 18255 .The range of Nifty for the day was 167 points.

10. Bank Nifty opened at 38302 and made an intra day high of 38448 and a low of 38007 before closing at 38370 .The range of Nifty for the day was 441 points.

11. US Dollar Index is trading at 95.148

12. Except Energy, IT and realty all sectors closed in red

13. India VIX eased to 16.5550

14. US 10Y yields are at 1.793

15. Nifty futures saw short covering

16. Bank Nifty futures saw short buildup

17. US Brent oil increased to 86.36

18. USD / INR increased to 74.233


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