22nd September' 2022 (Evening)

 22nd September' 2022 (Evening)  --  |  Written at 6.00 AM on 23rd September' 2022  |

  • Responding the the weak global cues on Thursday morning, The Indian markets feathered the storm well. When most of the global Indices were weak, we could come out without major breakdowns. The problem is not over though.
  • Both #NIfty and #BankNifty opened gap down and struggled through the day. They both found support towards the lower end of the day range and faced pressure towards the higher end of the range. On the daily chart, They both made a candle with a decent upper and lower shadow, indicating the above behavior.
  • Levels :
  • I had mentioned earlier that the support levels are deeper and markets are expected to consolidate above these levels. This has coincided with the global ruckus and our Indices are now at these important levels. The risk reward becomes more favorable at 17425 and 40275 though. 
  • Based only on price action, If a long trade is to be taken they can be taken at these levels with a risk reward as per Individuals taste. The Markets conditions globally will keep pressure on our Indices as well. Our resilience through the current conditions has been remarkable. 
  • #FII sold for 2000Cr plus on Thu and also created fresh shorts on Index futures. Their stance is bearish with most of the shorts that they had covered are now back again. The larger question is whether these shorts will now get a follow-through or they will be forced to cover again.
  • With Dollar Index at near 111 levels at a 20year high, Weakness of the INR against the Dollar will pose challenges. INR is already at close to 81 and this weakness is a strong indicator of the pressure on the equity.
  • The price action indicates the tug off war between the bulls and the bears and for further strength it is important for the markets to hold the above levels. I would observe the markets action before making fresh positions, though some long positions with strict stop losses can be considered with appropriate entries squeezed out from lower time frames and strict stop losses.
  • I believe #NIftyFMCG and #NiftyAuto are extremely strong sectors and #NiftyBank may add to this soon. However, #NiftyIT, #Reliance continue to drag. #NIftyIT may remain under pressure due to the slowdown concerns in US and Europe.
  • #Maruti as a stock seems strong and may give a very strong move after a breakout from the current range.
  • The Options OI indicate a strong resistance at 18000 for #Nifty and 41000 for #BankNIfty. call writing above 17700 on #Nifty and 41000 on #BankNifty. These levels would play out as resistances. The wider range of writing yesterday indicate some volatility and lack of direction from the current levels. Being the last week of this series, this is natural, lets see... 
1. FII were net selling for 2509 Cr today, while DII were buyers for 263 Cr. A net selling of 2246 Cr from the institutional side.
2. FII's created 1466 longs and created 28037 shorts on the index futures
3. On the option front FII  created 60859 short calls and   unwound 111763 short puts. They also bought 93727 long calls and  bought 124683 long Puts.
4. For next week expiry, Nifty has the highest OI for PE at 17500 followed by 17600 and highest OI for CE is at 18000 followed by 17700. Highest Put writing was seen at 17600 and highest call writing was seen at 17700 levels.
5. For the next week expiry, Bank Nifty has the highest OI for PE at 40000 followed by 39500 and highest OI for CE is at 41000 followed by 42000. Highest Put writing was seen at 40000 and highest call writing was seen at 41000 levels. 
6. Asian markets closed mixed and Europe closed in red
7. US markets trading in red as of now
8. The breadth of the market was weak today
9. Nifty opened at 17609 and made an intra day high of 17722 and a low of 17532 before closing at 17629 .The range of Nifty for the day was 190 points.
10. Bank Nifty opened at 40889 and made an intra day high of 41159 and a low of 40360 before closing at 40630 .The range of Bank Nifty for the day was 799 points.
11. US Dollar Index is at 110.987
12. FMCG, Auto, Media and Metals were strong today. BankNifty led the laggards
13. India VIX is at  18.8150
14. US 10Y yields are at 3.668
15. Nifty futures saw short buildup
16. Bank Nifty futures saw short buildup
17. US Brent oil is at 90.63
18. USD / INR is at 80.980

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