Indian equity benchmarks failed to hold on to the green in a choppy session on Wednesday, as gains in pharma and oil & gas shares were offset by losses in financial and IT counters. Globally, investors remained cautious following wild swings in the markets on updates about the Russia-Ukraine conflict.

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What do the charts suggest for Dalal Street now?

The Nifty50 has formed a small negative candle on the daily chart with minor upper and lower shadows, signalling the formation of a high wave type pattern at the highs, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

"More decisive weakness could confirm another lower top formation... A sustainable move above 17,490 levels is likely to negate this negative setup on the daily chart," he said.

A make-or-break level

The biggest support for the Nifty is at 17,077, below which, one can expect a waterfall of selling that will take it to 16,837, and then 16,410, said Prashanth Tapse, Vice President (Research), Mehta Equities.

Here are key things to know about the market before the February 17 session:

SGX Nifty

At 7:53 am on Thursday, Singapore Exchange (SGX) Nifty futures -- an early indicator of the Nifty index -- were up 52 points or 0.3 percent at 17,369.5, suggesting a positive opening ahead on Dalal Street.

Global markets

Asian markets began the day on a mixed note following the trend on Wall Street overnight, after Fed minutes showed US central bank policymakers agreed that faster rate hikes will be needed if inflation does not ease. Investors also remained cautious on news updates about the Ukraine-Russia conflict.

MSCI's broadest index of Asia Pacific shares outside Japan was up 0.3 percent percent at the last count. Japan's Nikkei 225 was down 0.3 percent, China's Shanghai Composite down 0.2 percent and Hong Kong's Hang Seng down 0.1 percent. South Korea's KOSPI was up 1.3 percent and Singapore's Straits Times 0.4 percent.

S&P 500 futures were down 0.1 percent. On Wednesday, the S&P 500 rose 0.1 percent but the Dow Jones declined 0.2 percent and the Nasdaq Composite 0.1 percent.

What to expect on Dalal Street

The Nifty50 is trading below its 50-day simple moving average in a largely negative sign, according to Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities.

"As long as it is above 17,200, the uptrend texture will continue till 17,450-17,550. On the flipside, a quick intraday correction is not ruled out if it trades below 17,200, below which, it could hit levels of 17,100-17,050," he said.

HDFC Securities' Shetti is of the view that the index's short-term uptrend remains intact, with immediate support at 17,200. An upmove above 17,490 may take the Nifty towards immediate resistance at 17,650 levels but an inability of the bulls to sustain the highs could result in another round of downward correction, he said.

Key levels to watch out for

Palak Kothari, Research Associate at Choice Broking, has identified the following zones:

FII/DII activity

Foreign institutional investors (FIIs) net sold Indian equities worth Rs 1,891 crore on Wednesday, according to provisional exchange data. However, domestic institutional investors (DIIs) made net purchases of Rs 1,180.1 crore

Call/put open interest

Exchange data shows the maximum call open interest is accumulated at the strike price of 17,500, with 1.7 lakh contracts, followed by 17,600 and 18,000, with 1.5 lakh each each. On the other hand, the maximum put open interest is at 17,000, with 1.3 lakh contracts, and 16,500, with 1.1 lakh.

This suggests immediate resistance at 17,500, followed by the hurdles of 17,700 and 18,000, and major support at 17,000, followed by 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 as well as price)

Short-covering

(Increase in price and decrease in open interest)

Short build-up

(Increase in open interest and decrease in price)

52-week highs

Two stocks in the BSE 500 pack hit 52-week highs: Blue Star and Rhi Magnesita.

52-week lows

Three hit 52-week lows: Indigo Paints, Jubilant Pharmova and EPL.

Volatility index

NSE's India VIX index -- which gauges the expectation of volatility in the market -- eased 0.1 percent to 20.6 on Wednesday, cooling off after rising as much as two percent during the session.

(Edited by : Abhishek Jha)

First Published:Feb 16, 2022 7:24 PM IST