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Trade Setup for September 8: Nifty 50 just 1.3% of 20,000

The Nifty 50 is up nearly 300 points this week so far and is up for five straight days. The last time he won five days in a row was in July. With this move, the index is poised for its second consecutive weekly gain and its first two-week advance in three months.

What ultimately boosted the index was the contribution from banking stocks which underperformed throughout the week. The Nifty 50 is just six points off the August 1 close of 19,733. To signal a weekly gain, the index must close above 19,435 on Friday.

The Nifty 50 is only 230 points away from the 20,000 mark.

For traders following the trend, 19,650 becomes an important level for the Nifty 50, said Shrikant Chouhan of Kotak Securities. Until the index holds above these levels, he expects the Nifty 50 to rise towards 19,800 – 19,825. “The uptrend could be vulnerable below 19,650,” said he added.

HDFC Securities’ Nagaraj Shetti said the overall Nifty 50 chart pattern indicates a bigger upside breakout of a larger consolidation/triangle pattern over the past five weeks for potential targets at 20,000-20,200. “Any dip towards 19,650 – 19,600 should be viewed as a buying opportunity.

Nifty Bank finally arrived on Thursday with all the constituents that set all cylinders on fire. The index closed at the highest level in a month and near the 45,000 mark. Thursday’s rise also means the index has turned positive for the week and will need to close above the mark. of 44,436 to record its third consecutive weekly gain.

“Nifty Bank saw another breakout on the daily chart,” said Kunal Shah of LKP Securities. Support for the index has now formed at 44,500, which also coincides with the index’s 20-DMA. He expects the banking index to reach the 45,200-45,500 levels on the upside.

Trade Setup for September 8: Nifty 50 just 1.3% of 20,000

Shipbuilding stocks were up sharply on Thursday, with all three builders – Mazagon Dock, Cochin Shipyard and Garden Reach Shipbuilders hitting record highs. So far, the three companies have at least doubled their market capitalization in 2023. With Thursday’s decision, the government’s stake in the three companies combined exceeded Rs 50,000 crore.

“I was a big bull in these shipyard businesses. Mazagon Dock around the levels of Rs 200-250. I was advising people to buy and kept telling them to buy up to the level of around Rs 1,000. However, what the rallies we are seeing in this sector are challenging is logic. So now I would be extremely cautious at this stage on these stocks which have done really very well. The order book or profitability projections of these companies do not warrant these kinds of valuations, so I would be extremely cautious and ask investors to be careful when buying these stocks,” said Sudip Bandopadhyay of Inditrade Capital.

Trade Setup for September 8: Nifty 50 just 1.3% of 20,000

What do F&O signals indicate?

Nifty 50’s September futures added 5.4 percent or 5.22 lakh shares in open interest. They are now trading at a premium of 41.65 points from 47.8 points earlier. On the other hand, Nifty Bank futures for September lost 2.5 percent, or 52,125 shares in Open Interest. Nifty 50’s Put-Call Ratio is now at 1.39 from 1.32 earlier.

PNB entered the F&O banned list as of today’s session, while Indiabulls Housing Finance, Balrampur Chini, BHEL, Delta Corp, Hindustan Copper, India Cements, Manappuram Finance and SAIL continue to remain on the prohibited list.

Nifty 50 Call side for September 14 expiry:

Adding Open Interest for Nifty 50 Call Strikes is now increasing. For next Thursday’s expiry, strikes between 19,800 and 20,200 saw the addition of Open Interest.

Strike Change of IO Prime
20,000 36.59 Lakh added 11:75
20,200 25.31 Lakh added 2.85
19,900 23.28 Lakh added 26.3
19,800 19.42 Lakh added 56.85

Nifty 50 on the Put side for the September 14 expiry:

The bulls are trying to establish a strong base for the Nifty 50 between 19,500 and 19,600. For next Thursday’s expiry, the Nifty 50 strike prices of 19,600 and 19,700 saw the addition of Open Interest , as well as unusual activity.

Strike Change of IO Prime
19,600 39.37 Lakh added 45.8
18,000 36.04 Lakh added 1.8
19,700 25.99 Lakh added 80.55
19,000 25.25 Lakh added 4.2

Let’s take a look at the stocks that added new long positions on Thursday, signifying an increase in price and open interest:

Action Price change Change of IO
India pellets 1.44% 13.20%
Larsen & Toubro 4.37% 12.77%
bata india 2.53% 12.02%
NTPC 1.33% 11.17%
Syngene 0.50% 10.63%

Let’s take a look at the stocks that added new short positions on Thursday, which means a drop in price but an increase in open interest:

Action Price change Change of IO
Birlasoft -1.05% 8.66%
Cement Ramco -2.06% 7.42%
Brittany -0.87% 6.59%
CONCOR -1.16% 4.62%
United Minds -0.61% 4.42%

Here are the stocks to watch ahead of Friday’s trading session:

  • Bajaj Finserv: Total August premium from Bajaj Allianz General at Rs 1,677.87 crore; total premium until August at Rs 9,228.81 crore.
  • Iconic cars: Signs Letter of Intent with Mahindra & Mahindra to open dealership in Howrah, West Bengal. The dealership will engage in the sale and after-sales of Mahindra’s range of personal vehicles, pick-ups and supros.
  • LTIMindtree: Launches AdSpark & ​​Smart Service Operations for retail media.
  • Sterlite Tech: Partners with TruVista to drive the growth and improvement of South Carolina’s rural connectivity infrastructure.
  • Mazagon Dock Shipbuilders: Signed Master Vessel Repair Agreement with US Government represented by NAVSUP Fleet Logistics Center. This is a non-financial agreement that should pave the way for repairs to US Navy ships during the voyage.
  • Tata Steel: Signed a pact with Avaada for Odisha Green Hydrogen, according to a Bloomberg report.
  • Shemaroo Entertainment: The CGST and the Central Excise Department carried out searches of the company’s premises on 5 September. The CEO, CEO and CFO spouses were arrested on September 6 and released on bail on September 7.
  • Foreign investors remained net sellers in the spot market on Thursday, while domestic institutions were small buyers.

    Trade Setup for September 8: Nifty 50 just 1.3% of 20,000

    Rupak De of LKP Securities said sentiment for the Nifty 50 remains positive as long as the index holds above 19,550. He expects gains to extend to the 19,900-20 levels. 000 in the short term, provided bullish sentiments remain intact.

    “I expect a rally of 2,000-3,000 points on the IT index from current levels. So all of your major stocks could contribute significantly, which is going to help the Nifty. Bank Nifty is still a little lag, it needs “To break above 45,000 at the close, if that happens, we’re looking at strong strength. Otherwise, Bank Nifty is simply still a strong performer in the market,” said Gautam Shah of Goldilocks Premium Research.