Market Analysis for May 18, 2022
Post Market Report & Nifty Chart Analysis
Price was going only one way today right from the open. There was bullish aggression at the open and the price was trading above the open from the very first candle. One hour into the day, the price broke yesterday’s high with good volumes. From there we witnessed a short-covering rally as more volumes kept coming in at higher levels.
Who closed the shorts? FIIs have closed their short positions significantly. They have closed almost 1/3rd of the short positions they were holding yesterday.
Although FIIs closed some of their shorts on the Index, they are still short and they have sold for ₹2192 Crores in the Cash market today. DIIs bought for ₹2294 Crores in the cash market.
FIIs have added long positions in the stock derivatives segment. They have been loading up long positions on stocks of late. FIIs slowly changing their Bearish stance.
Global sentiment was positive throughout our trading session. US markets have opened in green as well.
All sectors ended in green. Metals and Energy rebounded in style.
Reliance alone contributed 75+ points to the Nifty today. ICICI Bank, Bajaj Finance, TCS & Infosys were the other notable contributors.
Yesterday, despite a positive close, India VIX was up. India VIX finally cooled down by 7.3% and is now at 22.74.
With respect to Nifty Open Interest, CALLs were closed at 16000 and 16100 significantly. PUTs were added at the same strikes. This indicates that 16000-16100 zone might act as a support zone for the coming expiry.
Yesterday we pointed out that there was Institutional Activity in Kotak. Today we witnessed significant Institutional Activity in Siemens, LTI and SBI Cards. Stock-wise Institutional Activity data is available in the Toolkit.
LIC listed at a discount of 8%. Nifty outperformed LIC today.
Few days back Retail Inflation data was released and it was at an 8-year high. Today WPI Inflation data was released and it is at a record high of 15.1%.
Airtel Q4 net profit at ₹2008 Crores - much higher than street expectations.
Let’s now move on to the charts & price action.
Positional Trading Analysis for this week (May 16 to 20, 2022)
Nifty did all the 3 targets on the upside that we had given for the week - 16034, 16159, and 16234. We have updated the new levels for the rest of the week.
Bullish as long as the Nifty Futures closes above 16234 in the Daily Chart. Resistance on the upside being 16350, 16448, 16646. (Marked in Red).
Bearish only if Nifty Futures closes below 16159 in the Daily Chart. Support on the downside being 16034, 15930, 15734. (Marked in Green).
We will maintain a Neutral view if Nifty Futures trades between 16159 & 16234 (between the Blue levels).
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Disclaimer: The analysis is for educational & informational purposes only. Please consult your financial advisor before taking any trading/investing decisions.