Nifty has ended dead flat in yesterday's October series derivatives settlement session after swinging lower in the first half followed by recovery in the latter. Continuing from its weakness in the prior two sessions the index began to slide down immediately after open and only managed to take support at the 78.6% Fibo retracement of the up move from 8506 to 8736 and exhibited a smart rally to surpass the 21 & 50 hourly EMAs. It has formed a 'dragon fly' like doji on daily candlestick charts which is a bullish reversal pattern but require follow up strength. Trading volumes were weaker as compared to previous expiry sessions and the market breadth ended 1:2 in favor of decliners. Volatility (India VIX) subsided down to 14% but is expected to rise in line with its global peers. Momentum oscillators have rolled bearish on the daily scale suggest downside pressure in the coming session. Nifty is stuck between two key pivot points of 8525 on the downside and 8750 on the upside and a break on either side will lead to a strong directional move. In the immediate near-term 8645 above which a test of range highs is likely. Overall expect to remain on standby mode for a potential breakout scenario.
Trend among sectoral indices was largely negative led by losses in Autos (-1.35%), IT (-0.8%) and Metals (-0.75%); whereas marginal gains were posted in FMCG (+0.55%) and Healthcare (+0.1%) indexes. Broader market Mid-cap and Small-cap indices relatively underperformed their frontline peer with losses of -1% and -0.8% respectively.
Bullish Setups: TECHM, HUVR, SAIL, TTAN, LPC
Bearish Setups: APNT, BIOS, CEAT, INFO, RCAPT
| Nifty Index |
|
| Bloomberg Code | NIFTY Index |
| Spot Price | 8615 |
| Resistance 1 | 8644 |
| Resistance 2 | 8672 |
| Support 1 | 8575 |
| Support 2 | 8535 |
| Nifty 20 SDMA | 8667 |
| Nifty 50 SDMA | 8711 |
| Nifty 200 SDMA | 8069 |
| Adv : Dec [NSE] | 545 : 1086 |
| Turnover Rs Crs. BSE+NSE cash | 30,122 |
| Oscillators | Comments |
| RSI | Neutral |
| MACD | Bullish |
| Stochastic | Bearish |
| DMI & ADX | Bearish & Non Trending |
* OB: Over Bought
OS: Over Sold
Edelweiss Technical Reflection (ETR): " Dead flat on expiry " (28-Oct-16-EDEL)
Regards,
Tejas J. Shah +91 22 4063 5534
Edelweiss Research is also available on Bloomberg EDEL <Go>, Thomson First Call, Reuters and Factset. Please write to us in case you need any assistance in this respect.
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