Pre-market Setup for Thursday: Things to know before opening bell

On October 4, 2023, the Indian stock market continued its downward trend for the second consecutive session. The Nifty50 index broke below its upward-sloping support trendline and remained below the 50-day and 20-day Exponential Moving Averages (EMA). This suggests the possibility of short-term weakness. If the Nifty stays below 19,500, it could fall further to 19,200, the low of August. However, the formation of a Doji-type candlestick pattern on the daily charts during the downtrend may increase the chances of a bounce-back. Reclaiming the 19,500 level could potentially lift the index to levels around 19,600-19,700 in the coming sessions.

The BSE Sensex dropped 286 points to 65,226, while the Nifty50 declined by 93 points to 19,436. Technically, the Nifty50 formed a small candle on the daily chart with almost identical open and close, along with a long lower shadow. This pattern indicates the formation of a Doji or Hammer-type candle, which can signal a potential comeback of bulls from lower levels after confirmation. A sustainable close above 19,500 is expected to confirm a short-term upside bounce for the market.

However, it's important to note that the short-term trend of the Nifty remains negative. A decisive close above 19,500 levels could lead to an upside bounce towards 19,650 in the near term. Conversely, the inability to sustain the upside bounce or a decline below 19,330 could trigger fresh weakness in the market.

The Nifty Midcap 100 and Smallcap 100 indices experienced more significant corrections compared to the benchmark indices, falling 1.4 percent and 1.25 percent, respectively, reflecting weak market breadth.

Here are some key data points to consider for potential trading opportunities:

Key Support and Resistance Levels on Nifty:

• Support levels: 19,362, 19,332, 19,285

• Resistance levels: 19,457, 19,486, 19,533

Nifty Bank:

• The Bank Nifty closed below the 44,000 mark for the first time since September, falling 435 points to 43,964.

• The index formed a bearish candlestick pattern with minor upper and lower shadows.

• Immediate support is at 43,800, and a breach below this level could trigger further selling pressure.

• Resistance is in the range of 44,250 to 44,300, and a breakout above this range may lead to short-covering moves.

Call Options Data:

• Maximum Call open interest (OI) at 19,600 strike with 1.36 crore contracts.

• Significant Call writing at 19,500 strike, with 52.35 lakh contracts added.

• Maximum Call unwinding at 20,000 strike, shedding 18.91 lakh contracts.

Put Options Data:

• Maximum Put open interest at 19,400 strike with 1.16 crore contracts.

• Meaningful Put writing at 19,400 strike, adding 57.13 lakh contracts.

• Put unwinding at 19,500 strike, shedding 45.13 lakh contracts.

Stocks with High Delivery Percentage:

• Bharti Airtel, Coromandel International, UltraTech Cement, SBI Card, and ICICI Prudential Life Insurance Company had high delivery percentages.

Market Activity:

• 14 stocks showed a long build-up, indicating an increase in open interest (OI) and price.

• 60 stocks saw long unwinding, signaling a decline in OI and price.

• 98 stocks had a short build-up, indicating an increase in OI along with a fall in price.

• 14 stocks saw short-covering, which suggests a decrease in OI along with a price increase.

Bulk Deals:

• [List of bulk deals]

Investor Meetings on October 5:

• Mahindra & Mahindra, Tilaknagar Industries, Deepak Fertilisers and Petrochemicals Corporation, Mrs. Bectors Food Specialities, Schneider Electric Infrastructure, Cosmo First, Gati, Godawari Power and Ispat, and Divgi TorqTransfer Systems will have meetings with analysts and institutional investors on October 5.

Stocks in the News:

• Hero MotoCorp received 13,688 bookings for its newly launched flagship motorcycle, Karizma XMR.

• JM Financial's Chief Financial Officer, Manish Sheth, stepped down.

• Punjab National Bank reported 11.3 percent YoY growth in total business for the quarter ended September FY24.

• Jammu & Kashmir Bank reported a 12.03 percent YoY growth in total business for the same period.

• Marico reported low-single-digit domestic volume growth but double-digit constant currency growth in its international business.

• Bandhan Bank reported growth in loans & advances and total deposits.

• HealthCare Global Enterprises announced the acquisition of SRJ CBCC Cancer Hospital in Indore, with plans to expand further.

Fund Flow (Rs Crore):

• [FII and DII data]

Foreign institutional investors (FII) sold shares worth Rs 4,424.02 crore, while domestic institutional investors (DII) purchased Rs 1,769.49 crore worth of stocks on October 4, according to provisional data from the National Stock Exchange (NSE).

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