Trade setup for Thursday: SGX Nifty, further information prior to today's opening bell on the stock market

  • Sept. 8, 2022, 12:05 p.m.

Thursday's trading scheduleThe Indian stock market ended with a minor loss on Wednesday, continuing a volatile and range-bound trend for a third successive session. The Nifty 50 index corrected 31 points and closed at 17,624 levels, whereas the BSE Sensex shed 168 points and closed at the 59,028 mark. The Nifty Bank index dipped 210 points and finished at 39,455 levels. The broader market outperformed the Nifty, with the Mid-cap index rising 0.46 per cent and the Small-cap index rising 0.79 per cent. The advanced decline ratio finished in the positive zone after the end of Wednesday's session.

Here we list out key things in regard to trade setup for Thursday's session that one should know before the stock market's opening bell today:

Cues from the global market

In the US markets, Wall Street snapped a seven-day decline and finished in positive territory on Wednesday. The Dow Jones gained 1.40 percent, the Nasdaq gained 2.14 percent, the S&P 500 gained 1.83 percent, and the Small Cap 2000 gained 2.16 percent.

European and Asian equities came under pressure on Wednesday after worse than expected Chinese export data added to concerns over the health of the global economy. China's exports and imports lost momentum in August as surging inflation crippled overseas demand and new COVID curbs and heatwaves disrupted output, reviving downside risks for the shaky economy. Exports rose 7.1 per cent last month, compared with growth of 18 per cent in July. Imports increased by only 0.3 percent in August, down from 2.3% the previous month.This led to a narrower trade surplus of $79.39 billion, compared with a $101.26 billion surplus in July.

Asian market cues

The Japanese Nikkei was up nearly 2% in the early morning session on Wednesday, while Hong Kong's Hang Seng was down 0.3% and Chinese Shanghai was down 0.05%.

Today's SGX Nifty

In early morning deals on Wednesday, the SGX Nifty index was quoted 13 points lower at 17,738. That signals yet another range-bound session on Thursday.

Nifty's technical outlook

"Nifty formed a lower top lower bottom candle on Sept. 07 compared to the previous session but closed only nominally lower. The Nifty is looking for direction over the past few days and has outperformed the other countries by recovering from lows – whether intraday or otherwise. "Dear Deepak Jasani, Head of Retail Research at HDFC Securities, said Nifty could face resistance in the 17,696 to 17,764 band in the near term, while 17,468 could provide support," Deepak Jasani, Head of Retail Research at HDFC Securities said.

"The market breadth has been positive, but in spite of that, the Nifty 50 index has been restricted from moving higher. This is primarily because of factors such as the rising dollar index, short formations by FIIs in the index futures segment and weak global markets. The index is now trading within the range of 17,800 to 17,400 and a breakout beyond the same is required for a directional move. Hence, until we see a breakout on either side, traders are advised to be stock specific and avoid index directional trades. "The intraday supports for Nifty for the coming session are placed around 17,520 and 17,420 while resistances are seen around 17,690 and 17,760," said Ruchit Jain, Lead Research at 5paisa.com.

Technical analysis of the Bank Nifty

"Bank Nifty is trading above 20, 50, 100, and 200-day SMA, indicating positive bias in the short to medium term. "Bank Nifty continues to remain in an uptrend in the short term, so buying on dips continues to be our preferred strategy," said Rajesh Palviya, VP-Technical and Derivative Research, Axis Securities.

Mehul Kothari, AVP—Technical Research at Anand Rathi said, "Support for the Nifty Bank index is placed at 39,000 to 39,100 levels whereas it is facing a hurdle at 39,700 to 39,800 levels." So, a broader range of the banking index can be assumed between 39,000 and 39,800.

Call Option data that is useful

As per data shown by nseindia.com at 3.30 pm on September 07, major total call open interest was seen at 17700, 17800, and 17900 strikes with total open interest of 135803, 143645, and 141540 contracts, respectively. Call open interest increased significantly at the 17850 and 18000 strike prices, adding 33350 and 68311 contracts, respectively.The 17800 strike saw call unwinding, shedding 22535 contracts.

Data for the Nifty Put Option

Major total put open interest was seen at 17600, 17500, and 17400 strikes with total open interest of 117223, 163158, and 107454 contracts respectively. Put open interest increased significantly at the 17600 and 17500 strikes, with 38796 and 44511 contracts added, respectively.Put put unwinding was seen at the 17700 strike, which shed 18208 contracts.

Nifty Bank's Call Option data

Major total call open interest was seen at 39600, 39800, and 40000 strikes, with a total open interest of 62377, 67965, and 140487 contracts, respectively. Call open interest increased significantly at the 39600 and 39700 strikes, adding 38459 and 14883 contracts, respectively.

Nifty Bank Put Option data.

Major total put open interest was seen at 39500, 39300, and 39000 strikes with total open interest of 97583, 67918, and 105210 contracts, respectively. Major Put open interest additions were seen at 39400 and 39300 strikes, which added 26294 and 27797 contracts. The 39700 strike saw put unwinding, shedding 22224 contracts.

FII, DII data

Foreign institutional investors (FIIs) have net bought 758.37 crore worth of shares, whereas domestic institutional investors (DIIs) have net sold 138.67 crore worth of shares on September 7, as per provisional data available on the NSE.

NSE F & O prohibition list

The National Stock Exchange (NSE) has added Delta Corp stock to its F&O ban list for trade date September 8, 2022. Securities in the ban period under the F&O segment include companies in which the security has crossed 95 per cent of the market-wide position limit.

US bond yields

The US 10 year bond yield is up by 0.24 per cent to 3.273, whereas the US 30 year bond yield is up by 0.48 per cent to 3.421.

Author : Rajdhani Delhi Representative

Rajdhani delhi representative

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