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We have seen continuity in the upward journey for the second consecutive session with the benchmark indices gaining four-tenth of a percent on August 7. The Nifty50 remained above 19,500, which can be the immediate support, followed by 19,300, 5the hurdle is expected to be at the 19,600-19,700 area. If it gets surpassed and sustained, there is a possibility of Nifty breaking lower highs and lower lows formation.
The Nifty50 jumped 80 points to 19,597 and formed a small-bodied bullish candle with minor upper and lower shadow, which resembles a Spinning Top formation on the daily charts, which is a reversal pattern.
“Technically, this pattern indicates the formation of a Spinning Top-type candle pattern. Normally, such pattern formation after a reasonable decline or upmove signals impending reversal post-confirmation. Having shown a decent upside bounce from the lows in the last few sessions, the odds of reversal from the highs is likely,” Nagaraj Shetti, technical research analyst at HDFC Securities said.
A Spinning Top is often regarded as a neutral pattern that suggests indecisiveness in the market. It can be formed in an uptrend as well as in a downtrend.
The negative chart pattern like lower tops and bottoms is intact as per the daily timeframe chart. Presently, the market is in line with another lower top formation, which needs to be confirmed with a decline from the highs. Immediate support is at 19,450 and any upside from here could encounter strong resistance around 19,700 levels, Shetti said.
The BSE Sensex climbed 232 points to 65,953, while the Nifty Midcap 100 and Smallcap 100 indices rose half a percent and 0.2 percent respectively on positive breadth.
We have collated 15 data points to help you spot profitable trades:
Note: The open interest (OI) and volume data of stocks are the aggregates of three-month data and not just the current month.
Key support and resistance levels on Nifty
The pivot point calculator indicates that the Nifty may get support at 19,544, followed by 19,522 and 19,485. In case of an upside, 19,617 can be the key resistance, followed by 19,640 and 19,676.
Nifty Bank
On August 7, the Bank Nifty underperformed the benchmark as well as broader markets, falling 42 points to 44,837, though the index hit the 45,000 mark intraday but could not sustain the same. The index largely traded within the previous day’s range and has formed a bearish candlestick pattern on the daily charts, but still held above the critical support of 44,500 levels.
“Technically, not much has changed, and prices are still in a consolidation phase. Traders seem to be cautious and keeping their positions light ahead of the RBI policy, anticipating a clearer direction after this event,” Rajesh Bhosale, technical analyst at Angel One said.
Currently, prices are oscillating between two crucial averages, 50 SMA (simple moving average) and 20EMA (exponential moving average), and the next directional move is likely to occur once this range is broken.
“In such a scenario, the 50 SMA support is positioned around 44,700, followed by the key support level at last week’s low of 44,300. On the other hand, the immediate hurdle is expected at 20 SMA at around 45,200 and a bearish gap approximately at 45,400,” said Bhosale, who advised traders to keep a tab on the above levels ahead of the key event and trade.
The pivot point calculator indicates that the Bank Nifty is likely to take support at 44,784, followed by 44,728 and 44,637. In the case of an upside, the initial resistance is at 44,965 followed by 45,021 and 45,112.
Call options data
On the Options front, the maximum weekly Call open interest (OI) was at 20,000 strike with 77.58 lakh contracts, which can act as a key resistance for the Nifty. It was followed by 19,600 strike, which had 69.98 lakh contracts, while 19,700 strike had 63.19 lakh contracts.
The meaningful Call writing was at 20,000 strike, which added 17.47 lakh contracts, followed by 19,800 and 19,700 strikes, which added 12.52 lakh and 11.63 lakh contracts, respectively.
The maximum Call unwinding was seen at 19,500 strike, which shed 18.12 lakh contracts followed by 19,400 and 20,500 strikes, which shed 8.98 lakh contracts and 5.05 lakh contracts, respectively.
Put option data
On the Put side, the maximum open interest was at 19,500 strike with 94.31 lakh contracts. This can be an important support level for the Nifty50 in the coming sessions.
It was followed by 19,400 strike comprising 63.88 lakh contracts and 19,000 strike with 59.51 lakh contracts.
The maximum Put writing was seen at 19,500 strike, which added 38.81 lakh contracts, followed by 19,600 strike and 19,200 strike, which added 28.78 lakh contracts and 22.11 lakh contracts, respectively.
The meaningful Put unwinding was at 18,500 strike, which shed 4.04 lakh contracts, followed by 18,700 and 18,900 strikes, which shed 1.78 lakh contracts, and 1.62 lakh contracts, respectively.
Stocks with high delivery percentage
A high delivery percentage suggests that investors are showing interest in the stock. Petronet LNG, Tata Consumer Products, Dr Reddy’s Laboratories, Cummins India, and Bajaj Auto were among the stocks that saw the highest delivery.
71 stocks see a long build-up
Divis Laboratories, Dixon Technologies, PI Industries, Cipla, and Lupin were among the 71 stocks to see a long build-up. An increase in open interest (OI) and price indicate a build-up of long positions.
20 stocks see long unwinding
Based on the OI percentage, 20 stocks, including Vedanta, MRF, GNFC, ICICI Prudential Life Insurance, and Bank of Baroda saw long unwinding. A decline in OI and price indicate long unwinding.
47 stocks see short build-up
A short build-up was seen in 47 stocks, including Balrampur Chini Mills, India Cements, Delta Corp, Aditya Birla Fashion & Retail, and Ramco Cements. An increase in OI along with a fall in price points to a build-up of short positions.
43 stocks see short-covering
Based on the OI percentage, 43 stocks were on the short-covering list. These included Mahanagar Gas, Metropolis Healthcare, LTIMindtree, Mahindra & Mahindra, and IndusInd Bank. A decrease in OI along with a price increase is an indication of short-covering.
Bulk deals
Adani Green Energy: Qatar-based sovereign wealth fund INQ Holding LLC, a subsidiary of Qatar Investment Authority, has bought 4.26 crore equity shares in the Adani Group company at an average price of Rs 920 per share, which amounted to Rs 3,919.6 crore. However, promoter Infinite Trade and Investment sold 4.48 crore equity shares or a 2.8 percent stake in the company at an average price of Rs 920.43 per share, which amounted to Rs 4,131.1 crore.
(For more bulk deals, click here)
Results on August 8
Coal India, Hindalco Industries, Adani Ports, Oil India, Siemens, 63 Moons Technologies, Aarti Industries, EIH, Happiest Minds Technologies, Hikal, Ideaforge Technology, IRCON International, Phoenix Mills, Prestige Estates Projects, Radiant Cash Management Services, Sudarshan Chemical Industries, Talbros Engineering, Tilaknagar Industries, Utkarsh Small Finance Bank, and Windlas Biotech will be in focus ahead of quarterly earnings on August 8.
Stocks in the news
Godrej Consumer Products: The FMCG company has recorded a consolidated profit of Rs 318.8 crore for the quarter ended June FY24, falling 7.6 percent compared to the year-ago period as there was an exceptional loss of Rs 81.78 crore related to the acquisition of Raymond Consumer Care Business and other restructuring costs. Revenue from operations grew by 10.4 percent to Rs 3,449 crore compared to the year-ago period, with underlying volume growth of 10 percent.
Torrent Pharmaceuticals: The pharma company has reported consolidated profit at Rs 378 crore for June FY24 quarter, rising 6.8 percent over a year-ago period, driven by topline and operating numbers. Revenue from operations grew by 10.4 percent YoY to Rs 2,591 crore during the quarter, with India business rising 15 percent YoY to Rs 1,426 crore, but US business dropped 2 percent to Rs 293 crore during the same period.
Tata Chemicals: The Tata Group company has registered consolidated profit at Rs 523 crore for the quarter ended June FY24, falling 11.8 percent compared to the corresponding period last fiscal, dented by a lower operating margin. Revenue from operations grew by 5.6 percent year-on-year to Rs 4,218 crore.
Gland Pharma: The generic injectable-focused pharmaceutical company has reported a profit of Rs 194.1 crore for the first quarter of FY24, falling 15 percent compared to the year-ago period on a significant fall in operating margin. Revenue grew by 41 percent year-on-year to Rs 1,208.7 crore during the same period led by Europe and the Rest of the World businesses.
RailTel Corporation of India: The state-owned railway company has received the work order from Pimpri Chinchwad Smart City (PCSCL) for providing end-to-end services for monetisation of PCSCL city network infrastructure on the revenue sharing model. The estimated annual revenue from the contract is Rs 70 crore and the total revenue for 10 years is Rs 700 crore.
PB Fintech: The Policybazaar operator has reported a loss of Rs 12 crore for the quarter ended June FY24, narrowing from a loss of Rs 204 crore in the same period last year on strong topline and operating performance. Revenue from operations at Rs 666 crore for the quarter increased by 32 percent over a year-ago period.
MMTC: SEBI has cancelled the registration of MMTC as a stockbroker for its involvement in an illegal “paired contract”. The case pertained to the defunct National Spot Exchange Limited.
Fund Flow
FII and DII data
Foreign institutional investors (FII) sold shares worth Rs 1,892.77 crore, whereas domestic institutional investors (DII) bought Rs 1,080.80 crore worth of stocks on August 7, provisional data from the National Stock Exchange (NSE) showed.
Stocks under F&O ban on NSE
The NSE has added India Cements and Balrampur Chini Mills to its F&O ban list for August 8, while retaining Indiabulls Housing Finance, Gujarat Narmada Valley Fertilizers & Chemicals (GNFC), Hindustan Copper and Piramal Enterprises to the said list. Securities banned under the F&O segment include companies where derivative contracts have crossed 95 percent of the market-wide position limit.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.
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