The first week of 2024 has been anything but smooth for the Nifty 50 as volatility, combined with weak global cues have kept the index on a leash, preventing it from scaling the elusive 22,000 mark. In case the Nifty does end lower for the week, it will only be the second weekly loss seen by the index since October last year.
Thursday saw no expiry-related jitters on the index as it managed to recover some of the 200-plus point fall over the last two sessions. The Nifty comfortably crossed 21,600, sustained above it and also closed near the highest point of the day.
The Nifty needs to close above the 21,734 mark to ensure that the first week of the new year does not end on a negative note. Thursday was also a day dominated by real estate stocks, as the realty index ended at the highest level in 15 years, with most stocks ending at a record high.
On a day when the markets staged a rebound from the lows, domestic investors ended up being net sellers in the market, while foreign investors ended up with a buy figure.
Shrikant Chouhan of Kotak Securities said that the 21,550 zone will now act as a trend decider for intraday traders and a slip below that level may warrant caution. For now, he expects the Nifty to move back towards levels of 21,700 – 21,750, while a slip below supports can take the index down to 21,425.
The present setup suggests a promising trajectory for the Nifty to move towards levels of 21,800 – 21,850, said Rupak De of LKP Securities. A move above those levels can even take the index towards 22,000. A key support is at 21,500 and De advises dips towards those levels to be used as buying opportunities.
The Nifty needs to sustain above 21,550 – 21,600 levels to open possibilities of moving higher towards 21,850 – 21,900, according to HDFC Securities’ Nagaraj Shetti. Immediate support on the downside is placed at 21,550.
The Nifty Bank saw buying from lower levels on Wednesday and the buying the dips setup worked on the index as it saw follow-up buying on Thursday. Not only did the index outperform the Nifty on Thursday, but also closed above the 48,000 mark, a level it hasn’t manage to sustain on a consistent basis. The index also snapped a four-day losing streak.
For the week, the Nifty Bank needs a close above 48,292 to ensure a weekly gain.
The breakout above 48,000 confirms the resumption of the uptrend, indicating a potential move towards the 50,000 mark, said Kunal Shah of LKP Securities. The bullish crossover on the RSI further supports this positive momentum. In case of a pullback, the Nifty Bank has support near 47,700, which will act as a cushion for the bulls, Shah said.
What Are The F&O Cues Indicating?
Nifty 50’s January futures shed 1.8% and 2.12 lakh shares in Open Interest on Thursday. They are now trading at a premium of 127.35 points from 82.65 points earlier. On the other hand, Nifty Bank’s January futures added 2.4% and 48,150 shares in Open Interest. Nifty 50’s Put-Call Ratio is now at 1.22 from 0.76 earlier.
Chambal Fertilisers, Escorts Kubota, GNFC and India Cements will be in the F&O ban list from Friday, along with Balrampur Chini, Delta Corp, Hindustan Copper, IEX, Nalco, SAIL and Zee Entertainment.
Nifty 50 on the Call side for January 11 expiry:
For next Thursday’s weekly options expiry, the Nifty 50 call strikes of 21,500 and 21,600 have seen Open Interest addition.
Strike | OI Change | Premium |
21,500 | 23.37 Lakh Added | 50 |
21,600 | 22.7 Lakh Added | 80 |
Nifty 50 on the Put side for January 11 expiry:
On the Put side, the Nifty 50 strikes of 22,000 and 21,900 have seen addition in Open Interest for next Thursday’s expiry.
Strike | OI Change | Premium |
22,000 | 21 Lakh Added | 29 |
21,900 | 16.6 Lakh Added | 49 |
These stocks have seen addition in Fresh Long positions on Thursday, meaning an increase in both price and Open Interest:
Stock | Price Change | OI Change |
Alkem Labs | 0.60% | 40.88% |
India Cements | 3.73% | 19.77% |
L&T Technology Services | 2.37% | 11.81% |
Abbott India | 0.18% | 10.27% |
ICICI Bank | 0.55% | 8.23% |
These stocks added fresh short positions on Thursday, meaning a decrease in price but increase in Open Interest:
Stock | Price Change | OI Change |
LTI Mindtree | -1.24% | 16.55% |
Navin Fluorine | -1.82% | 15.22% |
Escorts Kubota | -0.16% | 13.74% |
PVRInox | -2.68% | 7.94% |
TCS | -0.36% | 6.25% |
These are the stocks to watch out for ahead of Friday’s trading session:
First Published: Jan 4, 2024 7:14 PM IST
Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.