Day trading guide for today: After a one day reprieve on Friday session, Indian stock market continued its downside move on Monday. Nifty 50 opened flat but sell-off triggered soon and the 50 stocks index finished 207 points lower at 16,887 levels. BSE Sensex lost 638 points and ended at 56,788 whereas Nifty Bank index dipped 602 points and closed at 38,029 mark. Small-cap index outperformed key indices after falling only 0.54 per cent even as the advance decline ratio was negative at 0.53:1.
According to stock market experts, a long bear candle was formed on the daily chart, that has engulfed more than half way mark of previous long bull candle of Friday. Technically, this pattern indicates a lack of strength to sustain the upside bounce in the market and the crucial lower support of 16,750 to 16,800 levels could be tested again. This is negative indication. Hence, a decisive slide below 17,750 levels is likely to negate the bullish pattern created on Friday’s upside move and that could eventually result in further strengthening of downside momentum in the market.
Day trading guide for Monday
Speaking on day trading strategies, Nagaraj Shetti, Technical Research Analyst at HDFC Securities said, “The short term trend of Nifty remains weak. Any sustainable move below 16,750 levels could bring sharp negative momentum on the cards. On the upside, 17,060 to 17,100 could act as a strong hurdle for the short term. The next important support for NSE Nifty is placed at 16,750 levels.”
“Nifty index has shown signs of an ‘Impulsive’ down move from the recent high of 18,100 which is a five wave structure. Friday’s pullback towards 17,150 to 17,200 range was the fourth wave pullback which completed 38.2 per cent retracement and it started the fifth wave down. This down move should breach last week’s low and form a lower low to complete this five wave structure. Once the index completes this structure, then a larger pullback move within a downtrend could be seen which would then retrace the recent corrective phase,” said Ruchit Jain, Lead Research at 5paisa.com.
The Elliott Wave analyst went on to add, “As of now the trend continues to remain negative and traders should watch out for a new swing low where the market could then try to form a short term support. That could happen in the range of 16,600 to 16,500 for Nifty and around 200 DEMA in Bank Nifty which is at 36,840. Hence, traders are advised to stay cautious for now and look for reversal signals around the above mentioned support zone.”
Nifty call put option data
Speaking on Nifty call put ratio, Shilpa Rout, Derivatives Lead Analyst at Prabhudas Lilladher said, “Nifty weekly expiry option chain witnesses PE writers actively adding their positions all the way down till 16000 strike – overall more than a lakh contracts, followed by 16500PE. CE writers standing tall at 17000CE and above strikes- with also more than a lakh contracts and PCR_OI at 16900 being nearly 0.5 ,is crucial to watch for the direction ahead.”
Bank Nifty call put option data
“Bank Nifty option chain on weekly basis, reflects on PE writers building positions aggressively at 37000 strike – overall more than 70 thousand contracts and CE writers showing resistance at 40000 strike – overall more than a lakh contracts, followed by 38500/39000 strikes. PE OI unwinding also seen at immediate strikes, which also hints on the immediate upside being capped for the index,” said Shilpa Rout.
Day trading stocks
Sharing intraday stocks for today, share market experts — Sumeet Bagadia, Executive Director at Choice Broking; Anuj Gupta, Vice President — Research at IIFL Securities and Manoj Dalmia, Founder & Director, Proficient Equities — recommended 6 stocks to buy or sell today.
Sumeet Bagadia’s stocks to buy today
1] Coal India Ltd: Buy at CMP, target ₹225 to ₹230, stop loss ₹207
2] MCX: Momentum buy at CMP, target ₹1290 to ₹1300, stop loss ₹1210
Anuj Gupta’s shares to buy today
3] Tata Steel: Buy at CMP, target ₹105, stop loss ₹89
4] Power Grid Corporation: Buy at CMP, target ₹230, stop loss ₹196
Manoj Dalmia’s stock picks for Tuesday
5] Tata Motors: Sell at ₹393, target ₹389, stop loss ₹395
6] Kotak Mahindra Bank: Sell at ₹1763, target ₹1742, stop loss ₹1772.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
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