Bears tightened their grip on Dalal Street on Monday as fears of aggressive interest rate hikes spooked investors. May consumer inflation hit a fresh 40-year high of 8.6 percent in the US, while India’s CPI inflation in May is expected to stay above 7 percent. The consistent selling by foreign investors and sour global market mood are dampening investor sentiment.
Reason For Yesterday’s Fall:-
1-) Global Sell-off.
2-) Rupee hit an all-time low.
3-) India’s 10Yr G-Sec at 7.60% (up by 8 bps), U.S. 10 Yr G-Sec at 3.24%
4-) Covid Outbreak in Beijing’s most populous city of Chaoyang.
5-) U.S. Inflation might reach 9%; more hawkish Fed Reserve expected.
What’s Next?
Continuous selloff by foreign investors, negative sentiments across global markets due to fear of aggressive rate hikes by the US Federal Reserve (US Fed), coupled with a weaker rupee was dampening investors’ risk appetite, we expect the near-term volatility in markets to disappear as markets discount the US Fed’s rate action.
For long-term investors, it is an opportunity to buy high-quality names like banking and financials.
Dalal Street Summary
Nifty (down -2.65%) – Open 15877.55, High 15886.15, Low 15684.00, Close 15774.40
Bank Nifty (down -3.13%) – Open 33728.65, High 33774.05, Low 33210.35, Close 33405.85
Sensex (down -2.55%) – Open 53184.61, High 53207.08, Low 52527.08, Close 52.939.57
India VIX – up 14.25% to end at 22.36
FII’s: Net Sellers : ( – 4164.01 Crores )
DII’s: Net Buyers : ( + 2814.50 Crores )
Bullish Sectors – Not a single sector in green due to a huge selloff.
Bearish Sectors – IT (-4.12%), MEDIA (-3.97%)
Top Gainers Stocks – Nestle Ind. (+0.49%), Bajaj-Auto (+0.08%)
Top Losers Stocks– BajajFinsv (-6.74%), Bajaj Finance (-5.21%)
Nifty Open Interest Put Call Ratio (PCR): 0.70
Maximum CE Open Interest Strike: 16000
Maximum PE Open Interest Strike: 15700
Bank Nifty Open Interest Put Call Ratio (PCR): 0.64
Maximum CE Open Interest Strike: 34000
Maximum PE Open Interest Strike: 33000
(The maximum CE PE open interest strike rate indicates that the market is likely to move in that particular range in the coming days)
Technical View of Nifty and Bank Nifty
Nifty
After opening with a big gap-down, the index continued to witness a sell-off throughout the day.
Some support was seen around 15680 (Spot) level, which will now act as an important level to watch out for.
Index spot has respected the mentioned support level multiple times in the previous month of May and March, 22’.
For the coming week ahead, a daily close below the mentioned support level will lead to a further downward move, till then it will act as an important support level.
Nifty Futures Strategy for Tuesday
Nifty Future has resistance at 15820 if breaks and sustains above that level, then it will take it to 15900-15980.
Support at 15660 breaks and sustain below that level will take it towards 15600—15510.
Bank Nifty
Bank Nifty broke the falling channel on the intraday charts, due to a gap-down opening.
The index has taken multiple support around 33200 throughout the trading session on Monday.
For the coming trading sessions, 33200–30000 will act as a support level, any failure to break this will lead to a bounce back.
Bank Nifty Futures Strategy for Tuesday
Bank Nifty Future has resistance at 33500 if breaks and sustains above that level then it will take it to 33700—33900 levels.
Support at 33200 breaks and sustain below that level then it will take it to 33000—32750 levels.
Top Stock Picks For Today
Bharat Forge (Futures)
Technical Chart of Bharat Forge
Weakness is seen on the hourly charts, with the momentum indicators like RSI also suggesting the same. Now we will expect a fresh downward move in the days to come.
Strategy – Traders can sell Bharat Forge Futures below 640 for the downside move till 630 and then to 620 in the days to come. Support and stop loss is around 660 on a closing basis.
More will update soon. Trade safely with levels. To get dalal street all updates on your WhatsApp, click on the image given below.
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