Stock Market

Trade Setup for Thursday: Top 10 things you should know before Opening Bell

Kshitij Anand

Chillicious News

Indian market consolidated for a fourth consecutive day in a row on Wednesday largely led by weak global cues. The Nifty slipped below its two crucial support level of 9,150 and 9,050 respective as it registered its biggest fall of the year 2017.

The Nifty which closed below its crucial support level of 13-days exponential moving average (EMA) placed at 9,038 made a bearish candle which closely resembles that of an ‘Inverted Hammer’ on the daily candlestick charts.

A bounce back could well be on the cards because the index is trading close to its crucial support levels. Investors should not go short in this market till the time it holds above 8,975, while a close above 9,075 could start the uptrend again, suggests experts.

We have collated top ten data points on how to help you in spotting profitable trade:

Key Support & Resistance Level for Nifty:

The Nifty consolidated for the fourth consecutive day in a row and closed below its crucial support level of 9,050. It slipped below its crucial 13-days EMA placed at 9,038. The Nifty 20-DEMA (double exponential moving average) is placed at 8,987.

According to Pivot charts, the key support level for Nifty is placed at 9,008, followed by 8,987, and 8,955. If the index starts to move higher then key resistance levels to watch out are 9,062, followed by 9,094, and 9,116.

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Nifty Bank:

Nifty Bank closed 237 points lower at 21,781. Important Pivot level which will act as crucial support for the index are 20,723, followed by 20,666, and 20,578. On the upside, key resistance level are 20,868, followed by 20,956 and 21,014.

Call Options Data:

On the options front, maximum Call open interest (OI) of 64 lakh contracts stands at strike price 9,200 which will act as a crucial resistance level for the index, followed by 9,100 which now holds 50 lakh contracts in open interest and 9,300 which has accumulated 44 lakh contracts in OI.

Call Writing was seen at strike prices 9,000 (5.3 lakh contracts added), and followed by 9,100 (13.1 lakh contracts were added). Call unwinding was seen at strike prices 9,300 (3.2 lakh contracts were shed), followed by 9,500 (3.3 lakh contracts were shed).

“We have seen fresh Put writing at strike prices 9,050 and 8,900 while significant Call writing was seen at strike prices 9,100, 9,150, 9,200, 9,250 which will keep its restricted upside on an immediate basis,” Chandan Taparia, Derivatives and Technical Analyst at Motilal Oswal Securities told Chillicious.

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Market base shifts higher to 8,900:

Maximum Put OI of 54 lakh contracts was seen at strike price 8,900 which will act as a crucial base for the index, followed by 8,800 which has accumulated 53.9 lakh contracts, and 9,000 which now holds 46 lakh contracts in OI.

There was hardly any put writing while unwinding was seen at strike prices 9,100 (14.8 lakh contracts shed), followed by 9,000 (2.7 lakh contracts were shed), and 8,800 (1.4 lakh contracts were shed).

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FII & DII Data:

The foreign institutional investors (FIIs) bought shares worth Rs 357 crore compared to domestic institutional investors which sold Rs 780 crore in Indian equity market.

Stocks with high delivery percentage:

High delivery percentage suggests that investors are accepting the delivery of the stock which means that investors are bullish on the stock.

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10 stocks saw Long Buildup:

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16 stocks where short covering was seen:

Short covering is seen when price moves higher but OI reduces.

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56 stocks saw Long Unwinding: 

Long Unwinding happens when there is a decrease in OI as well as in price.

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96 stocks saw Short Buildup:

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