Profit booking erased all gain of the last six sessions on Dalal street. Nifty 50 slipped below 11700 and Bank Nifty performed worst for the day. Technically, now immediate support at 11640, till it sustained above the support level index price may test 11750-11780. On the flip side below 11640 levels, the price may extend downfall to 11550-11520.
On the back of weak global cues, Dalal street witnessed a bloodshed move. the Benchmark Index extended its loss in the second half of the trading session and broke the 11700 levels on a closing basis. Yesterday’s fall was led by IT and Banking stocks.
Nifty50 tested 12000 marks in the morning session but failed to hold the gain as traders preferred to book profit. The BSE Sensex ended below 40000 marks with a loss of more than 1000 points.
The NSE Nifty 50 index followed the global trend and ended at 11680.35 after a decline of 290 points. India Volatility Index surged to 8% to end at 22.05. Market breadth remained in favor of sellers. Around 1326 stocks on the NSE ended with losses while 381 stocks managed to gain.
On the sectoral front, all indices ended in the red. The worst performer was IT and Banks. The Nifty Bank ended nearly 3.25% lower while the PSU Bank index declined over 2.84%. The other major loser were Media & Realty stocks. Broader markets continued to underperform. The Nifty Midcap index fell 1.70% while the small-cap index ended with losses of 1.72% on the Option’s weekly expiry.
Technical View of Nifty and Bank Nifty
Nifty 50 formed an Engulfing candle on the daily chart. Technically below 11640, the price may extend its fall to further downside. Else above 11640, the price may test 11750-11780.
According to open interest data, the maximum call open interest stand at 12000 and the maximum put at 11700 & 11600 indicates a trading range for upside for upcoming sessions.
Valuation-wise maximum Call & Put stand at 11800 & 11700 respectively indicates a crucial level for the index. A PCR sustained its support to 11700 levels.
Nifty futures strategy for the day
Resistance comes at 11750 and Support lays down at 11650
Strategy – Buy above 11650, for the target of 11720-11750 with a stop loss of 11600 OR Fresh sell would be seen either below 11600 or around of resistance level.
Bank Nifty was one of the worst performers of the day. Index price failed to surpass its last high of 24190 and fizzled out from the higher level. The price settled approx its day low and near its immediate support of 23000. Technically, below 23000, the bear is likely to dominate the battlefield for downside targets of 22700-22400. Else may test 23400-23600
Nifty Bank futures strategy for the day
Resistance at 23600 and Support at 23000
Strategy – Buy above 23000, for the target of 23300-23500 OR Fresh sell would be seen either below 23000 or around of resistance level.
Top stocks recommendations for today (16th Oct 2020)
The stock looks extremely weak on the daily chart and ready to break its support level. Traders can go short below 332 for the downside move till 318 and then to 314 levels in intraday session.
Hurdle and stop-loss above 344.
PRAJ IND (Cash)
Stock formed a bearish candle on the daily chart. Traders can do selling around 75 for the downside target of 72 and then to 70 levels in intraday session.
Hurdle and stop-loss above 77.50.
Hindustan Unilever, the stock broke the major resistance level of 2160 in the last trading session but was unable to sustain above the same on the closing basis. It also formed a dark cloud cover pattern on the daily chart. Traders can go for selling around the level of 2140 for the downside target of 2100 – 2090 by keeping SL above 2180.
JSW STEEL (Future)
JSW Steel stock created negative divergence on the daily chart with the bearish candlestick pattern on higher levels. Traders can go for selling in it below the level of 289 for the downside target of 278 by keeping SL above 300.
ICICI Bank (Option)
ICICI Bank formed a good engulfing pattern with high volume on the daily chart after the short-term uptrend. It also broke the upside trend line.
Traders can go for buying in ICICI Bank 390 Put Option around the level of 13 for the upside target of 20 – 21 by keeping SL below 5.5
DLF is sustaining below its 200 DEMA for the last one and a half months and also formed an Engulfing pattern on the chart with the high volume.
Traders can go for buying in DLF 150 Put Option around the level of 8 for the upside target of 11 – 11.50 by keeping SL below 4.95
Traders can trade safely in Nifty, Bank Nifty and given stock recommendations with levels only. More will update during market hours.
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