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Market sentiment is expected to remain positive, although benchmark indices posted gains after hitting a new high on February 23. Intermittent consolidation and correction are always part of any steady rally. Therefore, the Nifty 50 may face immediate resistance at 22,300 in the next session, followed by 22,500, with immediate support at 22,000 level and then 21,900, experts said.
On February 23, the BSE Sensex fell 15 points to 73,143, while the Nifty 50 lost 85 points from its all-time high of 22,297.50 and closed with a loss of 5 points at 22,213. The index has formed a bearish candlestick pattern on the daily charts, but continued forming higher highs for the eighth consecutive session.
“Nifty closed at the day’s low due to profit booking. However, sentiment remained positive in the short term as the index closed above the crucial resistance level of 22,200, with the next resistance seen at 22,400” , Rupak De, Senior Technical Analyst. at LKP Securities said.
Consider short-term support at 21,900. As long as Nifty maintains levels above 21,900, the index can continue to be considered a buy on dips, he advised.
Santosh Meena, head of research at Swastika Investmart, said the Nifty has come out of a 45-day consolidation period, indicating a potential upside towards 22,500 level. “Immediate support lies at the 20-day moving average (DMA) around 21,900, while the 50-day DMA at 21,700 serves as a key support level.”
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Key Support and Resistance Levels on Nifty
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The pivot point calculator indicates that the Nifty is likely to get immediate support at 22,190 followed by 22,163 and 22,121 levels, while on the upper side, you can see immediate resistance at 22,223 levels followed by 22,301 and 22,344 levels.
Ingenious bench
On February 23, the Bank Nifty fell 108 points to 46,812, continuing the downtrend for the third consecutive day and formed a bearish candlestick pattern on the daily charts, while the previous downward-sloping resistance trend line was now acting as a level. support for the index.
“Bank Nifty has been consolidating in the range of 46,400 – 47,400 since the last three trading sessions,” said Jatin Gedia, Sharekhan Technical Research Analyst at BNP Paribas.
Expect the Bank Nifty to continue consolidation before the next bullish move resumes and expect the index to rise towards 48,000 – 48,300 from a short-term perspective.
According to the pivot point calculator, the Bank Nifty is expected to get support at 46,727 followed by 46,604 and 46,405 levels, while on the upper side, the index may find resistance at 46,860 levels followed by 47,250 and 47,449 levels.
Purchase option data
On the weekly options data front, 23,000 strike owned the maximum Call open interest with 1.26 crore contracts, which may act as a key resistance level for the Nifty in the near term. It was followed by the strike of 22,500, which had contracts of 65.80 lakh, while the strike of 22,300 had contracts of 55.33 lakh.
Significant call drafting was seen in the 23,100 strike, which added 31.95 lakh contracts, followed by 22,300 and 22,500 strikes which added 29.1 lakh and 27.35 lakh contracts, respectively.
The maximum reduction in demand occurred in the 22,100 strike, which eliminated 4.67 lakh contracts, followed by the 22,000 strike, which eliminated 4.02 lakh contracts, and 21,900 strikes of 64,500 contracts.
put options data
On the Put side, the strike of 21,000 held the maximum open interest, which can act as a key support level for Nifty, with 76.06 lakh contracts. It was followed by the 22,000 strike comprising 74.16 lakh contracts and then the 21,500 strike involving 53.04 lakh contracts.
Put’s significant writing was 21,200 strikes, which added 15.09 lakh contracts, followed by 22,200 strike and 22,300 strikes, which added 14.86 lakh contracts and 12.79 lakh contracts.
The liquidation was observed in the 21,900 strike, which eliminated 1.69 lakh contracts, followed by the 21,100 strike, which eliminated 1.55 lakh contracts, and the 23,000 strike, which eliminated 16,500 contracts.
Stocks with high delivery percentage
A high delivery percentage suggests that investors are showing interest in the stock. Crompton Greaves Consumer Electricals, ICICI Prudential Life Insurance Company, Marico, Aditya Birla Capital and Shriram Finance recorded the highest delivery among F&O stocks.
40 Stocks See Long Accumulation
Long accumulation was seen in 40 stocks including Astral, Indian Hotels, Aditya Birla Capital, Vodafone Idea and Jubilant Foodworks. An increase in open interest (OI) and price indicates an accumulation of long positions.
37 stocks see a long sell-off
As per OI percentage, 37 stocks saw prolonged sell-off including ABB India, Siemens, Coal India, Piramal Enterprises and Balrampur Chini Mills. A decline in OI and price indicates a prolonged sell-off.
67 Stocks See Brief Accumulation
Brief accumulation was seen in 67 stocks including Canara Bank, Oracle Financial Services Software, India Cements, Metropolis Healthcare and IndiaMART InterMESH. A rise in OI coupled with a fall in price points to an accumulation of short positions.
42 stocks see short covering
Based on OI percentage, 42 stocks were on the short covering list. This included Indus Towers, REC, RBL Bank, Larsen & Toubro and Bandhan Bank. A decrease in OI along with an increase in price is an indication of short covering.
PCR
The Nifty Put Call Index (PCR), which indicates the mood of the stock market, fell to 1.02 on February 23 from the previous session’s levels of 1.19. PCR above 1 indicates that the trading volume of put options is greater than that of call options, which generally indicates increasing bearish sentiment.
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Fund Flow (Million Rupees)
FII and DII data
Foreign institutional investors (FIIs) bought shares worth Rs 1,276.09 crore, while domestic institutional investors (DIIs) bought shares worth Rs 176.68 crore on February 23, provisional data from the NSE.
Stocks under F&O ban on NSE
The NSE added Canara Bank to the F&O ban list for February 26, keeping Aditya Birla Fashion & Retail, Ashok Leyland, Balrampur Chini Mills, Biocon, GMR Airports Infrastructure, GNFC, Hindustan Copper, Piramal Enterprises, PVR INOX, RBL Bank. SAIL and Zee Entertainment Enterprises to the said list. Bandhan Bank, Indus Towers and National Aluminum Company were removed from the said list.
Prohibited securities in the F&O segment include companies where derivative contracts exceed 95 percent of the market-wide position limit.
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