NIFTY OUTLOOK & OPTION TRADING TIPS FOR 17 SEP 2024

Market Overview: Indian equity indices closed marginally higher on September 16, 2024. The Nifty ended at 25,383, up by 27 points (0.11%), while the Sensex closed at 82,988, rising by 97 points (0.12%). Despite a positive opening, the broader market witnessed lackluster trading, oscillating in a narrow range throughout the session. While most sectors saw buying activity, the FMCG sector faced profit booking, and the Media index emerged as the top gainer, rallying over 1%.

Key Highlights:

• Nifty Movement: The Nifty traded within the 25,350 to 25,440 range.
• Sensex Movement: The Sensex traded between 82,850 to 83,100.
• Sectors Performance: Media, banking, and metals posted gains, whereas FMCG and IT experienced slight declines.
• Technical Outlook: The formation of a small bearish candle on daily charts indicates indecisiveness between bulls and bears. The larger market texture remains bullish, but traders should expect near-term range-bound activity.

Key Support & Resistance Levels:

• Support Levels: For Nifty, key support is at 25,350 and 25,300, while Sensex support lies between 82,900-82,700.
• Resistance Levels: The key resistance for Nifty is at 25,500-25,575, and for Sensex, it's between 83,300-83,600.

Market Sentiment:

• A breach below 25,300 on the Nifty and 82,700 on the Sensex could change market sentiment, triggering profit-booking and exit from long positions.
• Overall market breadth leaned slightly positive, supported by selective buying in midcap and smallcap segments.

Sectoral Insights:

• Gainers: Banking, financials, realty, metals, and IT sectors showed strength. The Media index led sectoral gains with a 1% rise.
• Laggards: FMCG stocks faced intraday profit-booking and ended slightly in the red. IT also showed minor weakness.

Strategy for Traders:

• Buy on Dips: Despite the range-bound movement, the ongoing time-wise correction is seen as healthy, and traders are advised to continue with a "buy on dips" strategy. The larger bullish structure of the market favors gradual accumulation of stocks during corrective phases.
• Focus Areas: Traders should focus on sectors with relative strength, particularly banking, financials, realty, metals, and IT. Accumulating stocks showing strong relative performance in these sectors is recommended.

Outlook: With the larger trend still bullish, the market is expected to consolidate in the near term, providing opportunities for selective accumulation. Caution is advised near resistance levels, and traders should remain vigilant of any downside breach below key support levels.