On Monday morning, SGX Nifty was up 80 points, hinting at a continued positive momentum build-up in domestic equities.
Domestic equity benchmark indices look to start the new trading week on the back of strong gains last week, which saw Dalal Street soar to fresh all-time highs. S&P BSE Sensex currently sits at 56,124 while the NSE Nifty 50 is placed at 16,705. Broader markets have once again started moving higher while India VIX remains above 13 levels. On Monday morning, SGX Nifty was up 80 points, hinting at a continued positive momentum build-up in domestic equities. Global cues were positive as most Asian stock markets traded with gains, mirroring the upward move recorded on Wall Street during the last trading session.
Global cues: On Friday, US stock markets closed with gains after US Federal Reserve Chairman, Jerome Powell said that tapering bond purchases could begin by the year-end. NASDAQ zoomed 1.23% while S&P 500 gained 0.88% and Dow Jones jumped 0.69%. Among Asian peers, Shanghai Composite, Nikkei 225, TOPIX, KOSPI, and KOSDAQ were trading in the green. Hang Seng was down with losses.
Technical take: On the weekly chart, Nifty 50 formed a small positive candle with lower shadow, according to Nagaraj Shetti, Technical Research Analyst, HDFC Securities. “This weekly pattern indicate an uptrend continuation pattern in the market after a small range movement,” he added. However, chartists believe, mild dips can be expected in the market. “A mild dip towards short-term averages can be expected but the major bullish trend will be intact as long as Nifty trades above 16250 levels,” said Samco Research.
Levels to watch out: “The texture of the chart suggests that the 10 day SMA or 16550 would be the sacrosanct level for the breakout,” said Shrikant Chouhan, Executive Vice President, Equity Technical Research, Kotak Securities. “If the index crosses the level, the uptrend could continue up to 16825-16950 levels. On the flip side, dismissal of 16550 may trigger temporary weakness till 16375-16300 levels,” he added.
FII and DII trades: Foreign Institutional Investors (FII) have been net sellers of domestic stocks for 9 consecutive trading sessions. On Friday, FIIs pulled out Rs 778 crore from Dalal Street. Domestic Institutional Investors (DII) have, however, continued to pump in money in regular intervals. On Friday, DIIs injected domestic markets with Rs 1,646 crore.
Call and Put OI: For the upcoming weekly F&O expiry, maximum Call OI is placed at 16,700, followed by 17,000 strike price. On the other hand, Put OI is most at 16,600, followed by 16,500 strike.