NIFTY ON 09-12-2022 The major selling in IT dragged the Index be
NIFTY ON 09-12-2022
The major selling in IT dragged the Index below its crucial support level of 18500 and consequently the Index retested 18400 during intraday.
NIFTY opened gap up but failed to sustain 18600 as all the IT stocks felt the selling pressure as a result of negative commentary of HCL TECH management.
METAL also participated in the fall and lost 1.12% during the reading session.
FMCG and PHARMA remained the favourites of investors among all these volatility and uncertainty and gained 0.86% and 0.36% respectively. BANK also stood firm with a marginal gain of 0.08%.
It was the last hour of trading session which finally brought some relief to the Bulls and recovered approximately 100 point to reclaim 18500.
Finally NIFTY closed at 18496.60 with a loss of 0.61% making a Bearish Engulfing candle on daily chart.
Technical View : (Daily Chart)
NIFTY has made a Bearish-Engulfing candle which is sending the signals of further weakness in the Index.
NIFTY is moving above EMA 21, 34 but below EMA 13 and EMA 21< EMA34<EMA13 which can be interpreted as the indications of probable reversal from current levels.
RSI has fallen below 60 level which in combination of other factors indicates that Index has lost the momentum and further weakness may be observed in the Index.
Support and Resistance : Daily Chart
18410-18375 will work as the first support level for NIFTY and below this 18285 will hold strong support for NIFTY.
On the upper side NIFTY will face resistance in the range of 18550-18618.
Sectoral View:
FMCG and OIL&GAS look strong on weekly charts while with BANK one may trade with cautious approach as it can show some profit booking at higher levels.
METAL, PHARMA and IT may show some recovery from current levels despite being weak.
AUTO may continue to show weakness while the profit booking in PSU BANK is still on the cards.
View for Traders:
We will try to analyse the Index under following heads:
1. Technical Parameters
2. Global Cues
3. Options Chain Analysis
Technically Index is giving some signs of reversal from current levels. But, will this reversal will begin tomorrow itself? My answer will be ‘No’.
Generally, after such a negative trading session there comes a pull back rally and hence,we may expect the same tomorrow.
Further, in one of the previous posts it was mentioned that as per the Fibonacci Retracement level the Index may test 18360 in upcoming trading sessions and Index may take support there, During Friday’s trading session Index has already tested 18400 and recovered sharply.
Next comes the Global Cues. These cues are Negative in nature. The worries of recession in US and Europe are bothering the investors and the impact was visible in DJI and NASDAQ during Friday’s session.
The fall in Crude oil prices is perhaps also being taken as the sign of lessened demand which again will play negative for Index.
The Options data suggests that the Trading range for this week may remain 18350-18650 as below 18500 the Highest OI on put side is at 18400 and above 18500 the Highest OI on call side is at 18600.
Keeping all these factors in view it may be concluded that traders should remain cautious while trading on either of the sides as tomorrow a volatile session may be witnessed.
Buy NIFTY in the range of 18435-400 for a target of 18500-550. SL may be put below 18360.
Sellers must take their chances in the range of 18550-600. SL may be put above 18700.
WEEKLY PICKS
1. GLENMARK PHARMA
Buy in the range of 422-430
Target 462
SL 405
Potential Upside : 9.47%
2. INDUSIND BANK
Buy in the range of 1200-1205
Target 1345
SL : 1150
Potential Target 12.08%
3. ASIAN PAINTS
Buy in the range of 3190-3210
Target 3390
SL 3125
Potential Upside 6.26%
4. LINDE INDIA
Buy in the range of 3166-3180
Target 3540
SL 3050
Potential Upside 11.81%
5. SUPRAJIT ENGG LIMITED
Buy in the range of 340-345
Target 399.45
SL 320
Potential Upside 17.48%
The major selling in IT dragged the Index below its crucial support level of 18500 and consequently the Index retested 18400 during intraday.
NIFTY opened gap up but failed to sustain 18600 as all the IT stocks felt the selling pressure as a result of negative commentary of HCL TECH management.
METAL also participated in the fall and lost 1.12% during the reading session.
FMCG and PHARMA remained the favourites of investors among all these volatility and uncertainty and gained 0.86% and 0.36% respectively. BANK also stood firm with a marginal gain of 0.08%.
It was the last hour of trading session which finally brought some relief to the Bulls and recovered approximately 100 point to reclaim 18500.
Finally NIFTY closed at 18496.60 with a loss of 0.61% making a Bearish Engulfing candle on daily chart.
Technical View : (Daily Chart)
NIFTY has made a Bearish-Engulfing candle which is sending the signals of further weakness in the Index.
NIFTY is moving above EMA 21, 34 but below EMA 13 and EMA 21< EMA34<EMA13 which can be interpreted as the indications of probable reversal from current levels.
RSI has fallen below 60 level which in combination of other factors indicates that Index has lost the momentum and further weakness may be observed in the Index.
Support and Resistance : Daily Chart
18410-18375 will work as the first support level for NIFTY and below this 18285 will hold strong support for NIFTY.
On the upper side NIFTY will face resistance in the range of 18550-18618.
Sectoral View:
FMCG and OIL&GAS look strong on weekly charts while with BANK one may trade with cautious approach as it can show some profit booking at higher levels.
METAL, PHARMA and IT may show some recovery from current levels despite being weak.
AUTO may continue to show weakness while the profit booking in PSU BANK is still on the cards.
View for Traders:
We will try to analyse the Index under following heads:
1. Technical Parameters
2. Global Cues
3. Options Chain Analysis
Technically Index is giving some signs of reversal from current levels. But, will this reversal will begin tomorrow itself? My answer will be ‘No’.
Generally, after such a negative trading session there comes a pull back rally and hence,we may expect the same tomorrow.
Further, in one of the previous posts it was mentioned that as per the Fibonacci Retracement level the Index may test 18360 in upcoming trading sessions and Index may take support there, During Friday’s trading session Index has already tested 18400 and recovered sharply.
Next comes the Global Cues. These cues are Negative in nature. The worries of recession in US and Europe are bothering the investors and the impact was visible in DJI and NASDAQ during Friday’s session.
The fall in Crude oil prices is perhaps also being taken as the sign of lessened demand which again will play negative for Index.
The Options data suggests that the Trading range for this week may remain 18350-18650 as below 18500 the Highest OI on put side is at 18400 and above 18500 the Highest OI on call side is at 18600.
Keeping all these factors in view it may be concluded that traders should remain cautious while trading on either of the sides as tomorrow a volatile session may be witnessed.
Buy NIFTY in the range of 18435-400 for a target of 18500-550. SL may be put below 18360.
Sellers must take their chances in the range of 18550-600. SL may be put above 18700.
WEEKLY PICKS
1. GLENMARK PHARMA
Buy in the range of 422-430
Target 462
SL 405
Potential Upside : 9.47%
2. INDUSIND BANK
Buy in the range of 1200-1205
Target 1345
SL : 1150
Potential Target 12.08%
3. ASIAN PAINTS
Buy in the range of 3190-3210
Target 3390
SL 3125
Potential Upside 6.26%
4. LINDE INDIA
Buy in the range of 3166-3180
Target 3540
SL 3050
Potential Upside 11.81%
5. SUPRAJIT ENGG LIMITED
Buy in the range of 340-345
Target 399.45
SL 320
Potential Upside 17.48%