NIFTY OUTLOOK & OPTION CALL PUT TIPS FOR 17 AUG 2022

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The market started the shortened week on an upbeat note amid supportive global cues. The benchmark saw a gap open and then continued to trade in positive territory throughout the session. Healthy buying in sectors such as autos, FMCG and real estate fueled the rally. Consequently, the Nifty ended up 0.72% higher at 17,825 levels. Among the broader markets, mid-cap and small-cap outperformed to finish in positive territory of 1-1.5%. Almost all industry indices ended in the green except for PSU Bank and Media. Markets maintained their bullish bias throughout the trading session, helped by positive global cues and few domestic factors that prompted a rally in real estate, auto and banking stocks. The declining level of domestic inflation has raised expectations that central bank rate hikes could slow down going forward. While a strong FII fund infusion has certainly boosted investor sentiment. Easing inflationary pressures have encouraged domestic investors to remain optimistic about the pace of economic recovery. Better-than-expected CPI read, helped by slower food and fuel price rises, could limit the pace of RBI rate hikes. In the Asian market, the Chinese central bank surprised the market by cutting interest rates after weak economic data. After that, oil prices collapsed on demand concerns. Markets will continue to mirror global competitors for clues. In the meantime, we recommend investors continue to maintain a stock-specific approach. Also, investors will keep a close eye on fluctuating crude oil prices and currency movements. The Bank Nifty Index formed a doji candle on the daily chart, indicating indecisiveness at the current level. The index is showing signs of exhaustion after an amazing rally, but a profit-booking scenario will not be confirmed until a close below 38600. If the index breaks above 39400 on a closing basis, the rally will be extended towards the 39700-40000 level. Technically, the Nifty has held the higher bottom formation on intraday charts and 17700 would be the trend decision level. Above that, the index could reach the 17800-17900 level. On the upside, a quick intraday correction is possible if the index trades below 17700 and could retest below 17600-17500.

Resistance: 17900, 17950, 18000

Support: 17800, 17700, 17600