Indian equity benchmarks gave up intraday gains in choppy trade and closed flat on Thursday, as financial stocks retreated ahead of the expiry of monthly derivatives contracts due by the end of the session. Focus shifted to the upcoming annual Jackson Hole symposium, which analysts hope might offer hints about when the Federal Reserve may start trimming its massive stimulus.

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So, what do the charts suggest for Dalal Street?

The 50-scrip index formed an indecisive doji candlestick near an all-time high for a second straight day, according to Santosh Meena, Head of Research, Swastika Investmart. If Nifty50 manages to sustain above the immediate hurdle of 16,700, a short-covering move towards 16,900 can be expected, he said.

All eyes on Jackson Hole

"The Fed Chairman is keeping traders cautious and aside as the outcome of the event will come on Saturday morning. Whenever any major event stands in front of the market, an uncertain pattern is formed," said Shrikant Chouhan, Executive Vice President-Equity Technical Research at Kotak Securities.

"If the index crosses the 16,750 mark or falls below 16,350 on Monday, we can see a trending move in the market. Until then we would see stock-specific activity," he added.

Here are key things to know about the market before Friday's session:

SGX Nifty

Nifty futures trading on Singapore Exchange -- an early indicator of India's NSE Nifty50 benchmark index -- were up 12.5 points or 0.07 percent at 16,680.50 at 8:07 am, suggesting a mildly positive start ahead for Dalal Street.

Global markets

Equities in other Asian markets traded on a mixed note on Friday as investors globally turned cautious ahead of a long-awaited speech by Federal Reserve Chair Jerome Powell. Remarks from the US central bank's more hawkish policy makers and a deadly attack in Afghanistan also subdued sentiment. MSCI's broadest index of Asia-Pacific shares outside Japan dipped 0.1 percent, and Japan's Nikkei 225 index fell 0.46 percent. Overnight on Wall Street, the key indices fell around half a percent each. S&P 500 E-Mini futures were nearly unchanged, indicating a muted start ahead on Wall Street.

What to expect on Dalal Street

Gaurav Ratnaparkhi, Head of Technical Research at Sharekhan by BNP Paribas, expects a a minor dip in Nifty50 over the next couple of sessions structurally. "Short-term momentum indicators are also pointing towards a potential dip. The index looks set to test the 16,500-16,400 levels on the downside," he said.

Among the analysts disappointed by the participation of the banking index lately is Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel Broking. "The banking space, which was expected to lead from the front, has disappointed once again... From here on, the direction is likely to be dictated by the banking space only and, hence, it would be important to keep a close watch on it," he said.

Ratnaparkhi expects short-term consolidation, but said the medium-term outlook remains positive.

Key levels to watch out for

For Friday's session, immediate support for Nifty50 is seen at 16,600, followed by 16,500, according to Chavan. On the contrary, 16,700 remains a key level to watch out for, he said.

FII/DII activity

Foreign institutional investors withdrew a net Rs 1,974.48 crore from the Indian capital market on Thursday. However, domestic institutional investors made net purchases of Rs 1,055.21 crore, exchange data showed.

Call/put open interest

The maximum call open interest is accumulated at the strike price of 16,700. On the other hand, the maximum put open interest is at the strike of 16,600, and next at 16,500, NSE data shows. This indicates that immediate resistance can be expected at 16,700, and support comes in at 16,600, and then 16,500.

Long build-up

Here are five stocks that saw an increase in open interest as well as price, suggesting a build-up of long positions:

Long unwinding

(Decrease in open interest and price)

Short-covering

(Decrease in open interest and increase in price)

Short build-up

(Increase in open interest and decrease in price)

Stocks hitting 52-week highs

Hindustan Unilever, Tata Consumer, Godrej Consumer Products, HAL, Larsen & Toubro Infotech, DMart, Zydus Wellness, Jamna Auto, Linde, Kajaria Ceramics, Oil India and Carborundum Universal were among the stocks that clocked 52-week highs.

Stocks hitting 52-week lows

Only two stocks in the BSE 500 universe -- the broadest index on the bourse -- hit 52-week lows: Hero MotoCorp and Amara Raja Batteries. Besides, Clean Science and Technology, CarTrade and Abans Enterprises also hit 52-week lows.

Volatility gauge

The India VIX index -- which measures the expectation of volatility in the market -- rose 0.29 percent to 13.54, having bounced as much as 5.19 percent at one point during Thursday's choppy session.

(Edited by : Abhishek Jha)

First Published:Aug 26, 2021 7:06 PM IST