Market ended half a percent down on Wednesday 21 September 2022, as investors booked profit ahead of the US Federal Reserve’s monetary policy outcome, which is due later tonight. The Sensex fell 263 points to 59457, while Nifty ended 98 points down at 17718. Index heavyweights such as Housing Development Finance Corporation, L&T, Infosys, Tata Consultancy Services, and Kotak Mahindra Bank, among others, dragged the index the most. Broader markets underperformed equity frontliners. BSE Midcap index fell 162 points to settle at 25778, while BSE SmallCap index ended 204 points down at 29239. Bank Nifty index fell 0.6% to settle at 41203, India VIX, the volatility index, gained 2.8% to settle at 19.33 levels. Markets across the globe were trading with considerable volatility ahead of the Fed policy announcement. A 75bps hike by FED was factored in by the markets, while reports of mobilising Russian forces in Ukraine has escalated geopolitical tension and fears of rising inflation. Any military escalation will have a significant effect on the world & domestic economy. This will have an influence on the near-term trend of the global market and implications on the local market can be high as it is trading at premium prices compared to the world. Nifty has been in a corrective phase since the last few trading sessions. We have not seen a short term reversal attempt succeeding and hence maintain a negative bias for the near term. Monthly support is only seen at 17200. US Fed comments are expected to keep volatility high in the near term. Expect consolidation to correct in the near term as the broader market sentiment has also turned negative. FII and PRO positions also suggest reduction in net shorts suggesting limited downside in near term. For Nifty, maximum OI buildup is seen at 17200 Put and 17800 Call Option. For Bank-Nifty, maximum OI buildup is seen at 40600/41200 put and 41800/42500 call options. For the expiry day, expect nifty to trade with resistance of 17900 – any move above the same can invite short covering. The Bank Nifty index continued to face resistance at a higher level where 42200 will act as a hurdle. The index is stuck in a broad range between 40600 -42200 and a break on either side will decide the trend for the index. On the derivative front, the highest open interest on the call side is built up at 42200 and immediate support is visible at 40500 where fresh put writing has been observed.
Resistance: 17800,
17900, 18000
Support: 17700, 17600, 17500
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