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Trade Setup for Friday: Top 10 things you should know

Yatheendradas C.k. at 09:09 PM - Jul 27, 2017 ( ) Views: 296

Jul 27, 2017 08:27 PM IST | Source: Moneycontrol.com

Trade Setup for Friday: Top 10 things you should know before Opening Bell

The key takeaway from Thursday’s price action was that the bulls are still in charge. As long as 9,965-10,000 on the index holds, bulls have nothing to worry, suggest experts.

Moneycontrol News

The Nifty lost momentum after hitting a record high of 10,114.85 on the F&O expiry day on Thursday and closed flat with a slight negative bias, making a bearish candle which also resembles a pattern similar to ‘Shooting Star’ on the daily candlestick charts.

A bearish candle is formed when the index closes below the opening level. The Nifty index closed flat at 10,020.55 which was lower than the opening level of 10,063.25.

A bearish candle after a strong bullish candle is not a welcome sign for the bulls. But as long as 9,965-10,000 on the index holds, bulls have nothing to worry, suggest experts.

 

The index opened with a gap on the higher side at 10,063.25 and rallied to a record high of 10,114.85. It slipped to 10,005.50 in the second half of the trading session before closing the day at 10,020.55.

The key takeaway from Thursday’s price action is that the bulls are still in charge and the intraday volatility could be largely due to July F&O expiry which was the best expiry in the last 16 months.

The Nifty index closed the series with the gains of 5.43 percent and closed higher by 200 points from its VWAP average. The index tested the upper band of the rising channel by connecting the highs of 9,273 and 9,709 on the daily chart.

Here are the top ten data points to help you spot profitable trade.

Key Support & Resistance Level for Nifty:

The Nifty closed above 10,000 again at 10,020.55 on Thursday. According to Pivot charts, the key support level is placed at 9,979.07, followed by 9,937.63. If the index starts to move higher, key resistance levels to watch out are 10,088.37 and 10,156.23.

Nifty Bank:

The Nifty Bank closed 251.7 points higher at 24922.4 on Thursday. Important Pivot level, which will act as crucial support for the index, is placed at 24,803.8, followed by 24,685.2. On the upside, key resistance level is 25,036.6, followed by 25,150.8.

Call Options Data:

Maximum Call open interest (OI), of 51.84 lakh contracts, stands at strike price 10,100, followed by 10,200, which now holds 30.32 lakh contracts in open interest. This is followed by 10,000, which has accumulated 23.34 lakh contracts in OI.

Call writing was seen at strike price 10,200 , which saw the addition of 12.13 lakh contracts added, followed by 10,100 at 10.13 lakh contracts and 10,300 at 1.16 lakh contracts.

Meanwhile, Call unwinding was seen at strike prices 10,000 (30.39 lakh contracts were shed), followed by 9,900 (10.23 lakh contracts shed), and 9,800 (3.91 lakh contracts shed).

Image1

Put Options Data:

Maximum Put OI of 55.01 lakh contracts was seen at strike price 10,100, followed by 9,900, which has accumulated 45.07 lakh contracts in open interest, and 9,700, which now holds 43.44 lakh contracts in open interest.

Put writing was seen at strike prices 10,000 (11.79 lakh contracts added).

Meanwhile, put unwinding was seen at strike prices 9,900 (9.65 lakh contracts shed), followed by 9,700, where 5.44 lakh contracts were shed along with 9,800 (3.81 lakh contracts).

Image2

FII & DII Data:

Foreign institutional investors (FIIs) bought shares worth Rs 1,869.92 crore compared to domestic institutional investors, who sold Rs 660.03 crore worth shares in the Indian equity market.

Stocks with high delivery percentage:

High delivery percentage suggests that investors are accepting the delivery of the stock which means that investors are bullish on the stock.

Image3

62 stocks saw long buildup

Image4

3 stock saw long unwinding:

Long Unwinding happens when there is a decrease in OI as well as in price.

Image5

151 stocks saw short buildup:

An increase in open interest along with a decrease in price mostly indicates short positions being built up.

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