Indian equity benchmarks eked out minor gains at the end of a choppy session on Tuesday, led by gains in auto, pharma and PSU banking shares. Buying interest in heavyweights such as Reliance Industries, ICICI Bank, Bajaj Finance and Tata Steel also helped headline indices stay in the green.

Share Market Live

NSE

What do the charts suggest for Dalal Street now?

The Nifty50 has formed a small positive candle on the daily chart with a long lower shadow, suggesting the making of a bullish hammer or doji-type pattern, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

Buying appears to have emerged near the crucial lower support of the ascending trend line, around 17,000, which had offered a reasonable bounce around Union Budget 2022, he said. How Nifty fared in Budget week

17,350 an important hurdle

The market has made a temporary bottom, going by a hammer pattern on the daily chart, said Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities.

"The scope for a strong pullback has increased. If the Nifty is able to cross 17,350 decisively, it can touch 17,500... Levels of 17,120 and 17,030 will act as support for the index but below 17,030, it can hit 16,950/16,900 levels," he said.

Here are key things to know about the market before the February 9 session:

SGX Nifty

At 7:36 am on Wednesday, Singapore Exchange (SGX) Nifty futures -- an early indicator of the Nifty index -- were up 58.5 points or 0.3 percent at 17,318, suggesting a positive opening ahead on Dalal Street.

Global markets

Equities in other Asian markets began the day on a stronger note led by a technology stocks boost on Wall Street overnight. MSCI's broadest index of Asia Pacific shares outside Japan was up 1.1 percent at the last count.

Japan's Nikkei 225 was up 0.8 percent, Hong Kong's Hang Seng 1.9 percent, South Korea's KOSPI 0.7 percent and Singapore's Straits Times 0.1 percent, though China's Shanghai Composite was down 0.1 percent.

S&P 500 futures were up 0.2 percent. On Tuesday, the S&P 500 ended 0.8 percent higher, the Dow Jones 1.1 percent and the Nasdaq Composite 1.3 percent.

What to expect on Dalal Street

Charts signal the probability of another minor bounce or the formation of a lower top in the short term before a fall from the highs, said HDFC Securities' Shetti.

He sees a minor bounce from the current level or the 17,000 mark but warns that it could be short-lived, and one may expect another lower top formation below 17,800.

A move above Tuesday's high of 17,306 will provide a confirmation that could lead to positive momentum in the short term, believes Ruchit Jain, Lead Research at 5paisa.com. He advisess traders to look for buying opportunities if the Nifty surpasses this level on Wednesday.

Key levels to watch out for

The Nifty is likely to remain volatile ahead of the outcome of the RBI's bi-monthly policy, said independent technical analyst Manish Shah. A breakout above resistance at 17,330-17,350 will push the index towards 17,500-17,600 levels. He sees support for the index at 17,050, and believes that if buying continues till the weekly expiry (February 10), it could trade above 17,500.

Choice Broking AVP-Research Sachin Gupta sees resistance and support at the following levels:

FII/DII activity

Provisional exchange data shows foreign institutional investors (FIIs) net sold Indian equities worth Rs 1,967.9 crore on Tuesday, though domestic institutional investors (DIIs) made net purchases of Rs 1,115 crore.

Call/put open interest

Exchange data shows the accumulation of maximum call open interest at the strike price of 17,500, with 1.7 lakh contracts, and 17,600, with 1.4 lakh contracts. On the other hand, the maximum put open interest is placed at 17,000, with more than one lakh contracts.

This suggests major resistance in the 17,500-17,600 band, and meaningful support at 17,000.

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

Five stocks in the BSE 500 basket hit 52-week highs: Bank of Baroda, SIS, Jindal Stainless, GNFC and ELGI Equipments.

52-week lows

As many as 11 stocks hit 52-week lows, including HDFC Life, Lupin, MRF, IGL, Kansai Nerolac, AstraZeneca and Solara Active Pharma.

Volatility gauge

NSE's India VIX index — which gauges the expectation of volatility in the market — eased 3.7 percent to settle at 19.7 on Tuesday, having declined as much as 4.3 percent during the session.

Disclaimer: Network18, the parent company of CNBCTV18.com, is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.

Catch CNBC-TV18's budget coverage here

(Edited by : Abhishek Jha)

First Published:Feb 8, 2022 7:16 PM IST