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Indian equity benchmarks managed to finish higher for a second straight day in a choppy session on Friday, but gave up much of their intraday gains. Globally, investors digested hawkish comments from the Fed and the ECB's biggest ever hike in its key interest rate.

What do the charts suggest for Dalal Street?

The Nifty50 has formed a long negative candle on the daily chart with a minor lower shadow, suggesting more of consolidation or a minor downward correction ahead, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

"A long bull candle on the weekly chart shows an attempt to break out at significant overhead resistance around 17,800. An inability to show follow-through buying from here could mean a minor downward correction," he said.

All eyes on 18,000

A breakout at the sturdy wall of 17,700-17,800 levels backed majorly by the banking space and encouraging signs from the IT pack add to conviction that the Nifty50 may retest the 18,000 mark this week itself, Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel One, told CNBCTV18.com.

"If global peers support, we will not be surprised to see the index extend a move towards 18,200-18,350-odd levels... We advise traders to continue with a ‘buy on declines’ strategy and add fresh longs towards the support zone of 17,675-17,500," he added.

Here are key things to know about the market ahead of the September 12 session:

SGX Nifty

On Monday, Singapore Exchange (SGX) Nifty futures — an early indicator of the Nifty index — gave up nearly all of their gains and were up two points ahead of the opening bell on Dalal Street, having risen as much as 44.5 points to 17,886.5 earlier in the day.

Global markets

Equities in other Asian markets were in the green on Monday, following a rally on Wall Street, with MSCI's broadest index of Asia Pacific shares outside Japan up 0.4 percent at the last count. Japan's Nikkei 225 was up 1.1 percent.

S&P 500 futures were flat. On Friday, the three main US indices soared around 1-2 percent as investors went on a buying spree, shrugging off concerns about the economic outlook.

Earlier that day, a surge in banking shares lifted European markets on expectations of further monetary policy tightening by the ECB. The pan-European Stoxx 600 index finished 1.5 percent higher. Bankers expect the central bank to announce another hike of 75 basis points.

What to expect on Dalal Street?

HDFC Securities' Shetti believes the Nifty50 may remain choppy in the short term.

"A slide below immediate support at 17,770 could trigger a short-term correction. At the highs, 17,925 is likely to be a strong hurdle," he said.

Key moving averages

In a positive sign, the Nifty50 stands more than one percent above its long-term simple moving average:

FII/DII activity

Foreign institutional investors (FIIs) continued to net purchase Indian shares for a fourth straight day on Friday, in line with the trend in the past few weeks.

Last month, they made net purchases to the tune of Rs 22,025.8 crore — the first month of net inflows after 10 straight months of outflows, whereas domestic institutional investors (DIIs) net sold shares worth Rs 7,068.9 crore.

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Call/put open interest

The maximum call open interest is accumulated at the strike price of 18,000, with 1.4 lakh contracts, and the next highest at 19,000, with 1.3 lakh, according to exchange data. On the other hand, the maximum put open interest is at 17,000, with 1.6 lakh contracts, and at 17,500, with more than 85,000.

This indicates a strong hurdle at 18,000 and immediate support at 17,500 followed by a strong base at 17,000.

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 38 stocks in the broadest index on BSE — the BSE 500 — hit 52-week highs. Four out of these were part of the 30-scrip Sensex benchmark: ICICI Bank, ITC, Mahindra & Mahindra and SBI.

52-week lows

On the flipside, Natco Pharma was the only stock in the 500-scrip basket to hit a 52-week low.

First Published:Sept 11, 2022 3:55 PM IST