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Indian equity benchmarks continued to rise for a fourth straight session on Monday, led by strength in auto, metal, financial and oil & gas shares. All eyes are now on the outcome of a scheduled bi-monthly review of the RBI's Monetary Policy Committee due by the end of the week.

Globally, investors remained on the back foot as they assessed strong earnings against the prospects of a slowdown.

What do the charts suggest for Dalal Street?

The Nifty50 has formed a long bull candle on the daily chart following with a small lower shadow following a gap-up opening, suggesting continuation of momentum in the market, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

One can expect more upside in the short term with resistance in the 17,400-17,450 zone, he said.

Brace for profit booking in banking

The Bank Nifty has continued an uptrend with higher top and higher bottom formations on the daily chart, said Kunal Shah, Senior Technical Analyst at LKP Securities.

Some profit booking cannot be ruled out in the banking space given that momentum indicator RSI has entered overbought territory, he pointed out. He believes the banking index might consolidate ahead of the RBI policy outcome.

Here are key things to know about the market ahead of the August 2 session:

SGX Nifty

On Tuesday, Singapore Exchange Nifty futures — an early indicator of the Nifty index — declined as much as 87.5 points or 0.5 percent to 17,305.5 ahead of the opening bell on Dalal Street.

Global markets

Equities in other Asian markets were deep in the red after data showing a slowing US manufacturing sector fuelled fears of a global recession. MSCI's broadest index of Asia Pacific shares outside Japan was down 1.7 percent at the last count.

Japan's Nikkei 225 was down 1.6 percent, China's Shanghai Composite 2.5 percent and Hong Kong's Hang Seng three percent.

S&P 500 futures were down half a percent. On Monday, the three main US indices finished a choppy session lower, with the S&P 500 falling 0.3 percent, the Dow Jones 0.1 percent and the Nasdaq Composite 0.2 percent.

What to expect on Dalal Street

HDFC Securities' Shetti continues to hold the view that the Nifty's short-term trend is intact. There is no sign of tiredness in the market at the highs, he said.

"One can expect minor consolidation or volatility at the 17,400-17,500 hurdle, which could eventually be taken out on the upside in the near term. The near-term upside target to be watched out for is at 17,800 and immediate support at 17,150," he said.

Important levels to track

The Nifty50 and the Nifty Bank stand around seven percent each above their long-term simple moving averages, in a bullish signal.

Shah sees immediate resistance for the Nifty Bank at 38,000 and support at 37,000.

FII/DII activity

Call/put open interest

The maximum call open interest is accumulated at the strike price of 17,500, with 1.3 lakh contracts, and the next highest at 17,600, with 1.2 lakh contracts, according to exchange data.

On the other hand, the maximum put open interest is at 16,500, with 1.9 lakh contracts, and 17,200, with 1.6 lakh.

This suggests strong resistance at 17,500 and an immediate base at 17,200.

Long build-up

Here are five stocks that saw an increase in open interest as well as price:

Long unwinding

(Increase in price and decrease in open interest)

Short covering

(Increase in price and decrease in open interest)

Short build-up

(Decrease in price and increase in open interest)

52-week highs

A total of 20 stocks on the BSE 500 — the broadest index on the bourse —touched the milestone:

52-week lows

No stock in the 500-scrip pack hit a 52-week low.

First Published:Aug 1, 2022 9:40 PM IST