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The index has to hold above 16,250 zones to witness an up move towards 16,400 and then 16,500 zones, while on the downside support is seen at 16,150 and 16,000 levels, suggest experts.
Indian stock exchange bounced back sharply after briefly turning red on August 10, supported by a rally in telecom, IT, and banking stocks. The Nifty50 closed above 16,250 while the S&P BSE Sensex saw a rally of quite 150 points.
The Nifty50 hit a record high of 16,359 while the S&P BSE Sensex recorded a high of 54,779 in trade today.
Let’s check out the ultimate tally on D-Street – the S&P BSE Sensex rose 151 points to 54,554 while the Nifty50 rose 21 points to shut at 16,280.
Sectorally, buying was seen in telecom, IT, also as banks while selling pressure was seen in metals, public sector, realty, and utilities.
"What started as a sell-off in metal stocks dramatically triggered a sell-off within the small-cap Index after rallying for several months. The Midcap Index and therefore the PSU banks too were also not spared as both investors and traders booked profits,” S Ranganathan, Head of Research at LKP Securities, said.
“The index at close quite honestly wasn't reflective of the market mood because the breadth was very weak,” he said.
On the broader markets front – the S&P BSE Midcap index fell 0.8 percent, and therefore the S&P BSE Small-cap index fell by quite 2 percent – underperforming the benchmark indices.
India VIX moved up by 0.83 percent from 12.60 to 12.70 levels. Overall, lower volatility indicates that bulls are holding the command and declines are being bought.
On the front of the choice, the utmost Put OI is placed at 15,000 followed by 16,000 strikes while maximum Call OI is seen at 16,500 followed by 16,300 strikes.
Options data suggests a broader trading home in between 16,000 and 16,500 zones while an instantaneous trading range is between 16,150 and 16,400 zones.
Here’s what experts suggest investors should do on August 10:
Chandan Taparia, vice chairman | Analyst-Derivatives, Motilal Oswal Financial ServicesThe last half of the session witnessed a pointy decline to 16,200 followed by a recovery of 80 points within the last hour. It formed a Doji kind of candle on a daily scale because it closed flat almost its opening levels.
Now, the index has got to hold above 16,250 zones to witness an up move towards 16,400 then 16,500 zones while on the downside support is seen at 16,150 and 16,000 levels.
Palak Kothari, Research Associate at Choice Broking
Technically, the Nifty index has been trading during a range and hasn’t broken its previous day low and sustained above an equivalent one, which indicates bullish strength within the counter.
Furthermore, the Index has taken support from 50-HMA, which supports upside movement within the counter. A momentum indicator RSI & MACD is showing positive strength and Stochastic is additionally with positive crossover on the daily chart, which indicates an extra bullish move.
At present, the Nifty index has an instantaneous resistance at 16,360 levels while downside support shifted up to 16,150 levels.
Rohit Single, Senior Technical Analyst at LKP Securities.
After a robust volatile session, the index managed to shut the day on a positive note at 16,280 and formed a Doji candle pattern on the daily chart for the second consecutive day which signals indecision within the markets.
The Nifty again respected the support zone of 16,200 needless to say , and that we witnessed an honest pull-back from an equivalent level which hints until holding above 16200 zone.
The index may even see some extension within the existing consolidation zone of 16,200-16,350 zone and either side breakout will decide the ultimate direction move.
Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments
The markets climbed well above the 16,300 marks and seemed all poised to shut above it too. However, there was a pointy and nervous sell-off mid-day which brought the index on the brink of 16,200.
We recovered well but didn't close above the 16,300 levels. Once we are successful in doing so, we'll witness a rally to 16,600 because the next target is for the Nifty.