F&O expiry day: Sensex tanks over 1100 pts, Bank Nifty tumbles 3.3%; Nifty support at 17800

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October 28, 2021 4:31 PM

BSE Sensex and Nifty 50 ended below respective psychological levels on Thursday, on the back of profit booking on F&O expiry day

sensex, niftyMarkets witnessed a sharp decline and lost nearly 2%, pressurized by feeble cues. Image: Reuters

BSE Sensex and Nifty 50 ended below respective psychological levels on Thursday, on the back of profit booking on F&O expiry day. BSE Sensex tumbled 1.9 per cent or 1158 points to 59,985, while NSE’s Nifty plunged 354 points or 1.9 per cent to settle at 17,857.25. Index heavyweights such as ICICI Bank, HDFC Bank, Kotak Mahindra Bank, ITC, Reliance Industries Ltd (RIL), Infosys, among others contributed the most to the indices fall. Bank Nifty lost 3.34 per cent or 1,365.40 points to settle at 39,508.95. The broader markets also performed in tandem with equity benchmarks. BSE Midcap indices fell 1.38 per cent or 354 points, and BSE Smallcap index lost 1.6 per cent or 444 points. India VIX, the volatility index, surged 6.4 per cent and finshed at 17.91 levels. Technical analysts say that after a long time, the Nifty closed below 20-day SMA which is broadly negative for the market.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities

Markets ended as the worst performer in the Asian pack as selling intensified on the expiry day. After a weak opening, benchmark Nifty swiftly broke the important 18100 support level and retreated sharply thereafter. After a long time, the Nifty closed below 20 day SMA which is broadly negative for the market. For day traders, the short term trend is weak as the market is in a temporary oversold situation but a quick pullback rally cannot be ruled out. The intraday day trade setup suggests 18000 and 18050 would be the key hurdle for traders and below the same the correction wave is likely to continue till 17750-17700 levels. Contra traders can take a long bet near 17700 with a strict support stop loss at 17650.

Jay Thakkar VP and Head of Equity Research, Marwadi Shares and Finance

Nifty closed well in the negative territory in today’s trading session, however, it has crucial support at 17800 and below that 17600 levels whereas on the upside 18200 is a crucial resistance and till it doesn’t close above those levels the Trend will be sideways to negative. On the immediate basis a bounce back till 18000/18050 can’t be ruled out as the Index looks oversold in the short term. The medium term trend however has reversed from buy to sell.

As far as Nifty Bank is concerned it has broken its crucial support of 40700 levels and now till it doesn’t close above those levels it can consolidate or trade negative. On the immediate basis it has a support in the range of 39000-39500 hence it can bounce back from current levels, so immediate shorts are not advisable at current levels. Nifty Bank is likely to outperform Nifty in the short term.

Yash Gupta, Equity Research Analyst, Angel One

We have been suggesting retail investors remain cautious on market. Now, we expect the market to be volatile in the coming week along with that several IPOs are lined up which take the liquidity off the market.

Deepak Jasani, Head of Retail Research, HDFC Securities

In the latest fall the Nifty did not take support from the high made on Sept 24.17557 on the downside could offer support to the Nifty while 17968-18034 could offer resistance. The weakness in Nifty could continue but the pace of fall could now reduce.

Ajit Mishra, VP – Research, Religare Broking

Markets witnessed a sharp decline and lost nearly 2%, pressurized by feeble cues. Initially, weak signals from the global counterparts were weighing on the sentiment which further deteriorated with a decline in index majors. Nifty slipped below the crucial support zone of the 18,000 mark and settled close to the 17,865 zone. Selling pressure was widespread and most sectoral indices ended lower wherein banking, metal and realty were among the top losers. This fall in the index has derailed the recent recovery and we may see a further slide in the following sessions. On the benchmark front, Nifty has next support around 17,550-17,650 zone. We reiterate our cautious view on markets and suggest restricting leveraged positions.

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