August 3, 2023

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Nifty50 Drops near 19,300 Levels

Bears have once again dominated Dalal Street, causing the Nifty50 to drop close to 19,300 levels on August 3. This decline is a result of global weakness that is being reflected in the market. However, during the session, the Nifty50 showed strong defense, making it a key decider for the next move of the index.

Immediate Resistance

If the index holds at the current level, the immediate resistance would be the 19,400-19,600 area.
Breaking the 19,400-19,600 level could break the 50-day EMA placed at 19,160.

Bearish Candlestick Pattern Forms on Daily Charts

The Nifty50 has formed a bearish candlestick pattern on the daily charts, indicating lower highs and lower lows formation for the second consecutive session. This suggests a negative trend in the market.

Support and Resistance Levels

“The 50-day exponential moving average (DEMA) of Nifty, which is placed at 19,160, is likely to act as a support. A break below the 50-DEMA can drag the index to 18,600 levels,” says Ashwin Ramani, derivatives & technical analyst at SAMCO Securities.

BSE Sensex Corrects, Broader Markets Rebound

The BSE Sensex corrected by 542 points to 65,241. However, the broader markets rebounded, with the Nifty Midcap 100 index gaining 0.25 percent and the Smallcap 100 index rising 0.12 percent.

India VIX

India VIX, the fear index, jumped near 12 levels but couldn’t sustain there and closed at 11.19 levels, down 0.82 percent from 11.28 levels. This suggests that there is not a cause for concern yet.

Key Support and Resistance Levels on Nifty

The pivot point calculator indicates the following support and resistance levels on the Nifty:

Support: 19,313; 19,256; 19,164
Resistance: 19,497; 19,554; 19,647

Bank Nifty Extends Downward Journey

The Bank Nifty extended its downward journey for the third straight session, falling below the 50-day EMA. However, it managed to take support at the 44,500 mark due to a recovery in late trade.

Expectation of Rebound

Experts expect a rebound after a three-day correction, with 44,500 playing a crucial role in this recovery.

Key Support and Resistance Levels on Bank Nifty

The pivot point calculator indicates the following support and resistance levels on the Bank Nifty:

Support: 44,320; 44,141; 43,851
Resistance: 44,900; 45,079; 45,369

Options Data

Call Options Data

As per the options data:

The maximum weekly Call open interest (OI) is at 19,400 strike with 1.55 crore contracts, acting as a key resistance for the Nifty.
The meaningful Call writing was seen at 19,400 strike, which added 1.43 crore contracts.
The maximum Call unwinding was seen at 19,700 strike, shedding 64.93 lakh contracts.

Put Options Data

On the Put side:

The maximum open interest was at 19,300 strike with 1.09 crore contracts, which can be an important support level for the Nifty50.
The maximum Put writing was seen at 19,300 strike, which added 40.7 lakh contracts.
The meaningful Put unwinding was at 19,500 strike, shedding 66.55 lakh contracts.

Stocks to Watch

Stocks with High Delivery Percentage

Stocks that saw the highest delivery percentage are:

Vedanta
Godrej Consumer Products
Cummins India
Infosys
Hindustan Unilever

Long Build-Up

Stocks that saw a long build-up are:

MRF
Adani Enterprises
ACC
Glenmark Pharma
Aurobindo Pharma

Long Unwinding

Stocks that saw long unwinding are:

Escorts Kubota
GNFC
Navin Fluorine International
UPL
HCL Technologies

Short Build-Up

Stocks that saw a short build-up are:

Vedanta
RBL Bank
Godrej Properties
L&T Finance Holdings
Berger Paints

Short Covering

Stocks that saw short-covering are:

Abbott India
Deepak Nitrite
L&T Technology Services
Eicher Motors
Marico

Bulk Deals

Notable bulk deals include:

Vedanta: Promoter Twin Star Holdings sold 15.4 crore equity shares in the mining company, with foreign investors Copthall Mauritius Investment and Societe Generale being buyers for some of those shares.