Trade setup for Thursday: Top 15 things to know before the opening bell

The market lost the previous two trading sessions’  momentum and closed with around half a percent loss on September 21, due to selling across sectors barring FMCG. The correction in Asian peers also weighed on the market.

The BSE Sensex fell 263 points to 59,457, while the Nifty50 declined 98 points to 17,718 and formed a decent bearish candle on the daily charts amid volatility.

“A small negative candle was formed on the daily chart with minor upper and lower shadows. Technically, this pattern indicates a consolidation movement in the market,” Nagaraj Shetti, Technical Research Analyst at HDFC Securities said.

After a sharp weakness on September 15 and 16, the market showing small range weakness could signal broader range movement. The market breadth was negative on Wednesday and minor weakness was seen in broader markets. The Nifty Midcap 100 index was down 0.7 percent and Smallcap 100 index fell 1 percent.

The market is stuck within a broader high-low range of 18,100-17,500 levels and the movement within the said range is expected for the next few sessions. Any decisive move beyond this range could bring acceleration in the momentum on either side, the market expert said.

We have collated 15 data points to help you spot profitable trades:

Note: The open interest (OI) and volume data of stocks in this article are the aggregates of three-month data, and not just of the current month.

Key support and resistance levels on the Nifty

As per the pivot charts, the key support level for the Nifty is placed at 17,642, followed by 17,565. If the index moves up, the key resistance levels to watch out for are 17,817 and 17,915.

Nifty Bank

The Nifty Bank corrected 265 points to close at 41,203 on Wednesday and formed a Doji kind of pattern on the daily charts. The important pivot level, which will act as crucial support for the index, is placed at 40,894, followed by 40,585. On the upside, key resistance levels are placed at 41,507 and 41,811 levels.

CALL OPTION DATA

Maximum Call open interest of 37.55 lakh contracts was seen at 18,000 strike, which will act as a crucial resistance level in the September series.

This is followed by 18,500 strike, which holds 24.55 lakh contracts, and 17,800 strike, which has 21.13 lakh contracts.

Call writing was seen at 18,100 strike, which added 7.67 lakh contracts, followed by 17,800 strike which added 6.94 lakh contracts, and 18,000 strike which added 6.77 lakh contracts.

Call unwinding was seen at 18,900 strike, which shed 26,800 contracts, followed by 17,000 strike which shed 24,400 contracts, and 17,100 strike which shed 10,500 contracts.

PUT OPTION DATA

Maximum Put open interest of 33.41 lakh contracts was seen at 17,500 strike, which will act as a crucial support level in the September series.

This is followed by 17,000 strike, which holds 31.66 lakh contracts, and 16,500 strike, which has accumulated 29.61 lakh contracts.

Put writing was seen at 17,400 strike, which added 8.9 lakh contracts, followed by 17,000 strike, which added 5 lakh contracts, and 17,700 strike which added 4.66 lakh contracts.

Put unwinding was seen at 17,900 strike, which shed 1.73 lakh contracts, followed by 16,500 strike which shed 96,650 contracts and 16,900 strike which shed 55,000 strike.

STOCKS WITH A HIGH DELIVERY PERCENTAGE

A high delivery percentage suggests that investors are showing interest in these stocks. The highest delivery was seen in Bharti Airtel, ICICI Lombard General Insurance, TCS, Power Grid Corporation of India, and Wipro, among others.

19 stocks saw long build-up

An increase in open interest, along with an increase in price, mostly indicates a build-up of long positions. Based on the open interest future percentage, here are the top 10 stocks in which a long build-up was seen including City Union Bank, Honeywell Automation, Gujarat Gas, ITC, and Cummins India.

76 stocks saw long unwinding

A decline in open interest, along with a decrease in price, mostly indicates a long unwinding. Based on the open interest future percentage, here are the top 10 stocks including Bank Nifty, TVS Motor Company, Astral, India Cements, and Escorts, in which long unwinding was seen.

78 stocks saw short build-up

An increase in open interest, along with a decrease in price, mostly indicates a build-up of short positions. Based on the open interest future percentage, the top 10 stocks in which a short build-up was seen include Nifty Financial, Can Fin Homes, Mahanagar Gas, Dixon Technologies, and Indus Towers.

22 stocks witnessed short-covering

A decrease in open interest, along with an increase in price, mostly indicates a short-covering. Based on the open interest future percentage, here are the top 10 stocks in which short-covering was seen, including Metropolis Healthcare, Mahindra & Mahindra, Coal India, Mindtree, and L&T Infotech.

Bulk Deals

Dodla Dairy: Bharat Bio Tech International acquired 20,26,434 equity shares or a 3.4 percent stake in the company via open market transactions, at an average price of Rs 525 per share. However, investor TPG Dodla Dairy Holdings Pte Ltd sold 18,31,434 equity shares at the same price. TPG held 58.31 lakh shares or a 9.8 percent stake in the company as of June 2022.

Triveni Turbine: Abu Dhabi Investment Authority acquired 40,58,227 equity shares in the company, Aditya Birla Sun Life Mutual Fund bought 37,73,955 shares, the Government of Singapore purchased 41,98,226 shares, Plutus Wealth Management LLP bought 20,38,058 shares, SBI Mutual Fund purchased 75,45,788 shares and The Nomura Trust and Banking Company Ltd as the Trustee of Nomura Indian Stock Mother Fund bought 31,99,351 shares in Triveni Turbine. These shares were bought at an average price of Rs 226.7 per share. However, among promoter entities, Triveni Engineering and Industries sold its entire stake of 7,06,27,980 equity shares or 21.85 percent in the company at an average price of Rs 227.75 per share. However, Rati Sawhney bought additional 3,23,30,548 shares or nearly 10 percent at an average price of Rs 229 per share.

(For more bulk deals, click here)

Investors Meetings on September 22

Axis Bank: Officials of the company will attend BofA India Financials Virtual Tour.

Varun Beverages: Officials of the company will attend JP Morgan India Consumption Tour 2022 in Haryana.

Vedanta: Officials of the company will meet BofA Securities.

Eicher Motors: Officials of the company will interact with Quantum AMC.

Finolex Industries: Officials of the company will meet Grandeur Peak Global Advisors.

Varroc Engineering: Officials of the company will interact with Securities Investment Managers.

Indian Energy Exchange: Officials of the company will interact with Abu Dhabi Investment Authority (ADIA).

UPL: Officials of the company will meet several investors and analysts at a conference organised by JP Morgan.

Stocks in News

Veritas (India): Investor Swan Energy picked an additional 3.36 percent stake or 9.01 lakh shares in the company via open market transactions on September 20. It already held just 1,441 shares in the company earlier.

IDBI Bank: The bank sold the entire stake in Ageas Federal Life Insurance Company to partner Ageas Insurance International NV. In May 2022, the bank had entered into a Share Purchase Agreement to sell its entire stake of 20 crore equity shares in Ageas Federal Life Insurance Company to Ageas Insurance International NV. With this sale, IDBI Bank’s shareholding in Ageas Federal Life Insurance Company now stands at NIL.

Punjab National Bank: The public sector lender has raised Rs 658 crore by issuing Basel III compliant additional Tier-1 bonds at a coupon rate of 8.3 percent per annum, on a private placement basis.

Ashoka Buildcon: The company has received a contract for the construction of a new BG line, from South Western Railway as it has the letter of acceptance (LOA) from South Western Railway for the said project. The project includes electrical and telecommunication works in engineering, procurement and construction (EPC) mode. The accepted bid project cost for the project is Rs 258.12 crore. The completion period is 24 months from the date of the appointed date.

Heritage Foods: The company said the Board of Directors will meet on September 30, to consider raising funds by way of issue of equity shares on a rights issue basis.

Kirloskar Oil Engines: The company said the board members have appointed Anurag Bhagania as Chief Financial Officer of the company with effect from September 22. In addition, the company acquired a 24 percent stake in La-Gajjar Machineries (LGM). It had acquired a 76 percent stake in LGM in 2017 with an agreement that the balance holding will be acquired by KOEL over a 5-year period.

PB Fintech: The company will invest Rs 650 crore in the subsidiary Policybazaar Insurance Brokers, and also invest Rs 250 crore in another subsidiary Paisabazaar Marketing And Consulting.

Fund Flow

FII and DII data

Foreign institutional investors (FIIs) have net sold shares worth Rs 461.04 crore, while domestic institutional investors (DIIs) net bought shares worth Rs 538.53 crore on September 21, as per provisional data available on the NSE.

Stocks under F&O ban on NSE

Six stocks – Ambuja Cements, Can Fin Homes, Delta Corp, Escorts, PVR, and RBL Bank – are under the NSE F&O ban list for September 22. Securities thus banned under the F&O segment include companies where derivative contracts have crossed 95 percent of the market-wide position limit.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.