Trade setup for July 21, 2022: Things to know before stock market’s Opening Bell

Trade setup for July 21, 2022: Things to know before stock market’s Opening Bell

Market


Trade setup for Thursday: On account of overnight gains in the US markets and reduction in windfall tax by the Indian government on fuel prices, Indian stock market ended in positive territory on fourth successive session on Wednesday. Nifty 50 index ended 180 points higher at 16,520 whereas BSE Sensex shot up 630 points and finished at 55,398 levels. Nifty Bank index went 252 points north and closed at 35,972 levels.

Metals, IT and FMCG indices rose the most while telecom and power indices fell the most on Wednesday trade session. Broad market indices underperformed as the mid-cap and small-cap indices rose less than 0.5 per cent. Advance decline ratio was however positive at 1.33:1. Volatility index India VIX lost 2.20 per cent and ended at 16.82 on Wednesday.

Global market cues

Global stocks inched higher Wednesday amid speculation that the worst of this year’s equity rout may be over, even as concern over the potential for a global downturn sparked by hawkish central bank lingers. On Wall Street, Dow Futures eased though major indices extended its rally on Wednesday session. Buying in technology stocks continued on Wednesday and Tech heavy Nasdaq ended 1.58 per cent higher. Dow Jones closed 0.15 per cent north, S&P 500 went up 0.59 per cent whereas Small Cap 2000 surged 1.53 per cent.

In Asian markets, Chinese tech stocks advanced following a report that regulators are wrapping up an investigation into Didi Global Inc. with a hefty fine, with traders again hoping this will herald an end to a crackdown on the sector.

Nifty technical outlook

“Nifty broke out upwards with an upside gap on Wednesday but closed near the intra day lows, suggesting profit taking at highs. While volume expansion is supportive of further upside move, we will have to see whether the upside gap made by Nifty at 16,359 is filled or not in the next 1-2 days. Nifty could now remain in the 16,359 to 16,646 band for the near term,” said Deepak Jasani, Head of Retail Research at HDFC Securities.

Nifty Bank technical outlook

“For high risk traders, small range of Nifty Bank index is placed between 35,550 to 36,200 levels whereas broader range of the index lies in between 35,400 to 36,500 levels,” said Osho Krishan, Sr. Analyst – Technical & Derivative Research at Angel One.

Nifty Call Option data

“Maximum total Call open interest was seen at 16600, 16700 and 16800 strikes with total open interest of 158337, 134343 and 126535 contracts respectively. Maximum Call open interest addition was seen at 16700 and 16800 strikes which added 48727 and 62278 contracts respectively. Call unwinding was seen at 16300, 16400 and 16500 strikes which shed 54715, 63371 and 11399 contracts respectively,” said Chinmay Barve, Head — Technical and Derivative Research at Profitmart Securities.

Nifty Put Option data

“Maximum total Put open interest was seen at 16200, 16300 and 16400 strikes with total open interest of 145247, 104819 and 119234 contracts respectively. Maximum Put open interest addition was seen at 16400 and 16500 strikes which added 98764 and 136391 contracts respectively. Put unwinding was seen at 16100 and 16200 strike which shed 10356 and 8927 contracts,” said Chinmay Barve of Profitmart Securities.

Bank Nifty Call Option data

“Maximum total Call open interest was seen at 36200, 36300 and 36500 strikes with total open interest of 86379, 69715 and 102174 contracts respectively. Maximum Call open interest addition was seen at 36100, 36200 and 36400 strikes which added 43091, 45206 and 32973 contracts respectively. Call unwinding was seen at 35500, 35600 and 35700 strikes which shed 37723, 24031 and 30800 contracts respectively,” Chinmay Barve said.

Bank Nifty Put Option data

As per data shown by nseindia.com at 3.30 pm on 20 July, Maximum total Put open interest was seen at 36000, 35500 and 35400 strikes with total open interest of 102260, 110126 and 57863 contracts respectively. Maximum Put open interest addition was seen at 35800, 35900 and 36000 strikes which added 36375, 34748 and 92892 contracts respectively. Put unwinding was seen at 35200 strike which shed 7753 contracts.

FII DII data

Foreign institutional investors (FIIs) have net bought 1780.94 crore worth of shares, whereas domestic institutional investors (DIIs) have net sold 230.22 crore worth of shares on July 20, as per provisional data available on the NSE.

NSE F&O ban on 21st July 2022

The National Stock Exchange (NSE) has added Delta Corp stock under its F&O ban list for trade date 21st July 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.

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