Financial Market Analysis: Key Indicators Ahead of Trading Day

On October 10, 2024, stock market behavior remained stable, maintaining the previous day’s range and concluding with a slight upward bias. This was observed amid mixed trends from global markets. Market analysts predicted that this phase of consolidation is likely to continue with resistance anticipated at the 25,300 level, while a potential threshold of 25,500 is also under observation. The levels of 24,900 and 24,700 offer immediate and robust support, respectively, potentially indicating the initiation of a downward trend if breached.

In terms of technical indicators, the Nifty 50 index displayed a small bearish candlestick pattern on daily charts, with a minor upper shadow, suggesting a range-bound session. The index is hovering below its 50-day Exponential Moving Average (EMA), a critical marker for upward movement, yet it retains support above an ascending trendline crucial for any potential declines.

The Bank Nifty outperformed the Nifty 50, recording a 1.03% increase, or 524 points, landing at 51,531. This created a bullish candlestick pattern on daily charts despite low volume. However, similar to the Nifty 50, the Bank Nifty remains below its 50-day EMA marker of 51,778.

Options data highlighted significant activities, particularly at the 25,000 strike with the highest open interest, impacting short-term dynamics for the Nifty index. Notable call writing occurred at the 25,000, 25,100, and 25,600 strikes, while marked unwinding was observed at the 26,000, 25,500, and 25,300 levels.

Among the Bank Nifty’s options, the 52,000 strike held substantial open interest and may serve as resistance. Noteworthy activities included call writing at the 51,900 and 51,600 levels, alongside the 52,500 strike, whereas call unwinding was particularly visible at 51,000, 51,200, and 51,100 strikes.

Volatility continues to ease, as indicated by a decline in the India VIX to 13.50, a decrease of 4.44%, favoring bullish market sentiment. Additionally, the Nifty’s Put-Call ratio rose to 0.93, suggesting potential bullish sentiment amidst traders favoring puts over calls.

The financial analysis also covered market positions, including a noticeable increase in long positions across 43 stocks and a decline in open interest for 38 stocks, indicating potential long unwinding. Conversely, heightened open interest with price decreases was reported in 61 stocks, signifying an increase in short positions.

In the derivatives sector, certain stocks were placed under the Futures and Options ban, such as Chambal Fertilisers and Chemicals, while others like Bandhan Bank and Birlasoft remained under the ban.