The NSE benchmark Nifty50 is holding steady near 19,600 despite experiencing a significant drop of 257 points from its intraday high during the September derivative series expiry yesterday.
Let’s start with today’s observation. It opened the day at 19,581, approximately a 60-point gap-up from the previous day’s closing level of 19,523, and it formed a doji-like candle in the five-minute timeframe. Within 15 minutes, it fell by merely 30 points, marking an intraday low of 19,551 at 9:30 AM.
It ended up falling close to the previous day’s closing level of 19,523. After finding support there, it began gaining momentum and moved upward, reaching an initial high of 19,600 around 10:00 AM. However, it showed some weakness at this point and experienced a minor pullback.
Around 11:00 AM, it broke out of the pullback and continued rallying until 14:30, with a slight pullback around the mid-day trading session. During this rally, it crossed the 19,700 level during the afternoon trading session.
Eventually, sellers became aggressive at this level, causing the Nifty to slip to approximately 19,630 levels. It finally closed the session at 19,638, representing a gain of 0.59% or 115 points from its previous day’s closing level.
During the monthly expiry yesterday, Nifty fell by almost 275 points from its intraday high and eventually closed at 19,523, marking a decline of 193 points or 0.98%. It formed a significant full-bodied red candle with a small wick on the lower side, signifying a significant decline the next day. Fortunately, it did not occur today.
Intraday Chart (5-minute timeframe)
Turning your attention to the weekly observation, Nifty formed a doji-like candle with wicks on both sides. This week’s range was 274.55 points.
After experiencing a significant decline of approximately 519 points last week, it did slip below the level of 19,500 on an intraweek basis. However, a recovery on Friday helped the index close above the level of 19,600, but it still closed below its prior week’s low.
When examining the monthly candle, it exhibits a long upper shadow, with a green body as the close was greater than the open.
The Relative Strength Index (RSI) stands at 47.62 on the daily timeframe, while on the weekly and monthly timeframes, it stands at 60.72 and 66.01, respectively. On every timeframe, the RSI has deteriorated. Furthermore, the Nifty50 has closed above all key moving averages, including the 50-day, 100-day, and 200-day averages, on the daily timeframe except the 20-day.
Considering the current monthly expiry set for October 5, the Call Open Interest is approximately 17.06 lakhs, while the Put Open Interest stands at 14.57 lakhs. Significant open interest is observed at the 19,700 and 19,800 Call strike prices. On the Put side, substantial open interest is noted at the 19,600 and 19,500 strike prices, suggesting that these levels may serve as immediate resistance and support for the upcoming expiry.
The Put Call Ratio (PCR) currently stands at 0.85, according to data from the National Stock Exchange.
Investors should be aware that there will be a market holiday on October 2, 2023, which falls on a Monday, due to Gandhi Jayanti.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.