The equity benchmarks ended lower on November 17, succumbing to selling pressure at higher levels, with the Sentext closing 188 points down at 65,795 and the Nifty 33 points to end at 19,732.
The broad-based Nifty, which faced stiff resistance at 19,800-19,850, is expected to consolidate for a few days before getting into action mode, experts said.
The Nifty will have to hold the crucial support of 19,600-19,450. If the index manages to go past 19,850 decisively, it can even cross the 20,000 mark, they said.
“The hourly momentum indicator has a negative crossover which indicates that the consolidation can continue over the next few trading sessions. The Bollinger bands on the hourly charts are also contracting, indicating that there could be rangebound moves going ahead,” Jatin Gedia, technical research analyst at Sharekhan by BNP Paribas said.
On the downside, 19,630 – 19,600 is the support and this zone is crucial to hold on to for the uptrend to continue, he said.
The market breadth favoured bulls with 1,079 advancing shares and 1,048 declining on the NSE.
We have collated 15 data points to help you spot profitable trades:
Key support and resistance levels on Nifty
The pivot point calculator indicates that the Nifty may take support at 19,682 followed by 19,649 and 19,596. On the higher side, 19,788 can be the immediate resistance followed by 19,821 and 19,874.
On November 17, the Bank Nifty opened gap down, a day after the Reserve Bank of India increased risk weight on consumer credit exposure, and closed below the 20-day exponential moving average (EMA), falling 578 points, or 1.31 percent, to 43,584. The index formed a bearish candlestick with a long upper shadow on the daily charts. It is around 300 points away from the 200-day EMA (43,294).
On the weekly scale, too, it formed a bearish candle as banking stocks continued to underperform. “Now it has to cross and hold above the 43,750 zone for a bounce towards 44,044, then 44,250 levels, while a hold below the same could see some weakness towards 43,333 then 43,000 levels,” Chandan Taparia, senior vice president, analyst-derivatives, Motilal Oswal Financial Services, said.
As per the pivot point calculator, the index is expected to take support at 43,520 followed by 43,435 and 43,298. On the upside, the initial resistance is at 43,794 then at 43,879 and 44,016.
Call options data
On the weekly options data front, the 19,900 strike owned the maximum Call open interest (OI), with 77.54 lakh contracts, which can act as a key resistance level for the Nifty. It was followed by the 19,800 strike, which had 75.77 lakh contracts, while the 20,500 strike had 66.75 lakh contracts.
Maximum Call writing was seen at the 19,800 strike, which added 37.89 lakh contracts, followed by 20,400 and 20,500 strikes, which added 29.28 lakh and 27.31 lakh contracts.
Maximum Call unwinding was at the 19,500 strike, which shed 45,050 contracts, followed by 19,100 and 18,600 strikes, which shed 600 and 50 contracts.
Put option data
On the Put side, maximum open interest was at the 19,700 strike, which can act as a key support for the Nifty, with 49.4 lakh contracts. It was followed by 19,500 strike, comprising 49.25 lakh contracts, and 19,000 strike with 48.44 lakh contracts.
Meaningful Put writing was at 19,100 strike, which added 20.98 lakh contracts, followed by 19,000 strike and 19,500 strike, which added 20.53 lakh and 19.56 lakh contracts.
Put unwinding was at 19,900 strike, which shed 1.96 lakh contracts, followed by 20,200 strike, which shed 10,100 contracts, and 20,300 strike that shed 700 contracts.
Stocks with high delivery percentage
A high delivery percentage suggests that investors are showing interest in the stock. Indraprastha Gas, IndiaMART InterMESH, Bharti Airtel, Power Grid Corporation of India and Bajaj Auto saw the highest delivery among the F&O stocks.
54 stocks see a long build-up
A long build-up was seen in 54 stocks, including Exide Industries, SBI Life Insurance Company, MRF, Granules India, and Can Fin Homes. An increase in open interest (OI) and price indicates a build-up of long positions.
38 stocks see long unwinding
Based on the OI percentage, 38 stocks saw long unwinding, including Manappuram Finance, Indian Oil Corporation, India Cements, Chambal Fertilisers and Chemicals, and MCX India. A decline in OI and price indicates long unwinding.
31 stocks see a short build-up
A short build-up was seen in 31 stocks, including SBI Card, RBL Bank, State Bank of India, Aditya Birla Capital, and IDFC First Bank. An increase in OI along with a fall in price points to a build-up of short positions.
64 stocks see short-covering
Based on the OI percentage, 64 stocks were on the short-covering list. These include ABB India, ICICI Prudential Life Insurance Company, Ramco Cements, Bosch, and AU Small Finance Bank. A decrease in OI along with a price increase is an indication of short-covering.
The Nifty Put Call ratio (PCR), which indicates the mood of the equity market, dropped to 1.02 on November 17 from 1.18 in the previous session. An above 1 PCR suggests that the traders are buying more Puts than Calls, which generally indicates an increase in bearish sentiment.
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Stocks in the news
Aurobindo Pharma: The United States Food and Drug Administration (US FDA) concluded a pre-approval inspection (PAI) of Unit-I & III of formulation manufacturing facility of APL Healthcare in Telangana with zero observations. The inspection, conducted during the November 13-17 period, was closed with “No Action Indicated (NAI)”. APL Healthcare is a subsidiary of Aurobindo Pharma.
Exide Industries: The High Court has passed a decree by recording the terms of the Settlement Agreement executed by the parties namely Exide Industries, Vertiv Company Group Limited UK (VCGL), and Vertiv Energy (VEPL), while disposing of the suits pending since 2006. Both VCGL & VEPL agreed that they will not use the said CHLORIDE mark in India, either directly or indirectly, and will withdraw all their claims over this mark in favour of Exide.
SBI Cards and Payment Services: After the Reserve Bank of India on November 16 tightened rules for consumer credit and bank credit to NBFCs, the credit card issuing company said it would impact the capital adequacy ratios for banks and NBFCs, and for SBI Card, it would reduce capital adequacy by around 4 percent.
Cipla: The pharma company executed a facility demand guarantee of ZAR 945 million in favour of First Rand Bank, South Africa, for extending general banking facilities to Medpro Pharmaceutica (Pty) Ltd. Medpro is a step-down wholly-owned subsidiary of Cipla in South Africa.
RITES: CFM Mozambique has awarded the tender for 10 diesel-electric locomotives with incidental services to RITES at a total value of $37.68 million but the company lost the tender for 300 high-side wagons.
NBCC (India): NBCC has signed a memorandum of understanding with the Institute of Chartered Accountants of India (ICAI). ICAI has awarded the planning, designing and execution of its buildings and renovation works at various locations in India. NBCC will and complete the works at a PMC fee of 6.5 percent of the actual project cost.
Funds Flow (Rs Crore)
FII and DII data
Foreign institutional investors net sold shares worth Rs 477.76 crore, while domestic institutional investors offloaded Rs 565.48 crore worth of stocks on November 17, provisional data from the National Stock Exchange showed.
Stock under F&O ban on NSE
The NSE has added RBL Bank to its F&O ban list for November 20, while retaining Chambal Fertilisers and Chemicals, Delta Corp, Hindustan Copper, India Cements, Manappuram Finance, MCX India, and Zee Entertainment Enterprises in the list. SAIL has been removed from the F&O ban.
Securities banned under the F&O segment include companies where derivative contracts cross 95 percent of the market-wide position limit.
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