NIFTY WEEKLY OUTLOOK & OPTION CALL PUT TIPS FOR 17 OCTOBER TO 21 OCT 2022

WEEKLY RESISTANCE FOR NIFTY: 17250, 17350, 17450

PIVOT POINT: 17150

WEEKLY SUPPORT FOR NIFTY:  17050, 16950, 16850

WEEKLY CHART FOR NIFTY

Certainly spoiled global sentiments and hence, Nifty Monday 10 oct 2022 morning indicated a gap down opening with more than 200 points cut. In line with this, Nifty opened below 17100 and then tested the 17050 mark. Fortunately, bulls cushioned this fall and managed to pull the index during the remaining part of the session. Eventually, we managed to restrict losses to merely four tenths of a percent to conclude the session comfortably above 17200. We started the Tuesday 11 oct 2022 session on a flat note and since global markets were trading on a weak note, we slipped inside the negative territory within few minutes of trade. Thereafter, key indices consolidated in a range with lot of stock specific action visible on both sides. However, as we stepped into final hour of the session, the selling augmented to even sneak below the 17000 mark. Eventually, Nifty concluded the session with one and half a percent cut. Our markets started the Wednesday 12 oct 2022 session on a positive note and thereafter the price action depicted a classical structure of higher highs and higher lows during the session. The benchmark index dipped a bit in the initial trade which got bought into to continue the rise till the midsession. We again saw some profit booking as we stepped into the latter half. The decline was successfully absorbed by the bulls to conclude the session at the highest point of the day tad above the 17100 mark. The cues from the US bourses on 13 oct 2022 Thursday morning were neutral to slightly on the positive side. Despite this, our markets had a weak opening and as the day progressed, we kept on shrinking like a slow poison. Fortunately, we witnessed some buying interest at lower levels and saw some recovery as we stepped into the last hour of the trade. With some wild swings at the end, Nifty concluded the session with over six tenths of a percent loss. With Inflation becoming the most widely watched economic statistic globally, yesterday's inflation print in the US saw extreme volatility there and as expected our markets opened gap up in sync with global cues. IT & Financials buoyed by earnings led the rally before profit taking in Energy stocks wiped off a bit of gains. The broader markets did see buying interest in select stocks on the back of quarterly earnings although the gains were visible only across Large Cap names. Benchmark indices ended on positive note on October 14 with Nifty around 17200 At Close, the Sensex was up 684 points at 57919, and the Nifty was up 171 points at 17185.

NIFTY: STRONG SUPPORT& STRONG RESISTANCE LEVEL

The sacrosanct level of 17000 once again proved its mettle. In spite of not so favorable global environment, our markets managed to recover fair bit of ground; courtesy to recent laggard IT space, which has shown some sign of revival ahead of quarterly result of IT giant, TCS. We continue to remain sanguine as long as key support zone of 17000 – 16800 remains intact and meanwhile, the buy on declines approach remains the key. For the coming week, intraday supports are now visible at 17000 – 16900; whereas a move above 17300-17400 would trigger a short covering move towards 17500 and beyond.

TECHNICALLY SPEAKING

The Nifty had a strong leap from the support zone of 17,000-16,950. It broke out from a triangular pattern on the hourly chart & surpassed the key daily moving averages with an opening gap.  The index, however, failed to build upon the early gains. On the contrary, it witnessed fresh round of selling in the second half of the session.  The overall structure shows that the index is still in the short term consolidation phase. In terms of the price patterns, it can form a triangular pattern on the daily chart. This implies that the range bound action can continue in the short term. The index can revisit 17,050 on the downside. On the other hand, the near term resistance is at 17,350. The WPI like CPI still remains at elevated levels even though it has come down a bit from last month. The easing of inflation has primarily been on account of easing commodity prices globally. There is a good likelihood that global commodities may correct even further as the developed world faces the risk of recession which in turn would mean reduced demand. Even in India, with the festive season coming to an end, the months ahead may see tepid demand in comparison to the first half. We feel that WPI inflation should ease further in the next 4 to 6 months.