Trade Setup For Nov 6: Buy On Dips As Long As Nifty Is Above 24,000

Market participants would benefit by indulging in a buy-on-dips strategy as long as the NSE Nifty 50 is above the 24,000 mark, according to Rupak De, senior technical analyst at LKP Securities. However, he advised reviewing this strategy if the index drops below 24,000.

For traders, 24,000 and 78,800 would act as a sacrosanct support level for Nifty and the BSE Sensex, respectively, said Shrikant Chouhan, head equity research at Kotak Securities. "On the higher side, the Nifty could move up to 24,400-24,500 and the Sensex to 80,000-80,300, while on the flip side, below 24,000/78,800, traders may prefer to exit long positions," he said.

The Nifty 50 has formed a piercing candlestick pattern along with a positive divergence in the relative strength index and 150 DMA support, according to Aditya Gaggar, director of Progressive Share Brokers Pvt.

"As indicated yesterday also, a level of 23,800 will serve as immediate support for Nifty while on the higher side, and the resistance level is shifted higher to 24,370," he said.

Overseas investors remained net sellers of Indian equities for the 27th consecutive session on Tuesday, while domestic institutional investors also stayed net buyers.

Foreign portfolio investors sold stocks worth Rs 2,569.4 crore, according to the provisional data from the National Stock Exchange. The DIIs mopped up stocks worth approximately Rs 3,031 crore.

The Nifty November futures were up 0.74% to 24,295 at a premium of 82 points, with the open interest up 0.21%.

The Nifty Bank November futures were up by 1.51% to 52,394 at a premium of 187 points, while its open interest was down 9.27%.

The open interest distribution for the Nifty 50 Nov. 7 expiry series indicated most activity at 27,000 call strikes, with the 22,450 put strikes having maximum open interest.

For the Bank Nifty options expiry on Nov. 6, the maximum call open interest was at 60,500 and the maximum put open interest was at 43,000.

• NTPC: The board of NTPC on Tuesday approved multiple investments aggregating to Rs 79,738.5 crore. The company sanctioned an investment of Rs 29,344.9 crore for the Telangana Super Thermal Power Project, Phase-II. The board has approved an investment of Rs 29,345 crore for Phase II of the Telangana power project and an investment of Rs 29,948 crore for Stage II of the Nabinagar power project.

• Rail Vikas Nigam: A consortium including HFCL and others has emerged as the lowest bidder for BSNL's Rs 5,008 crore Bharat Net project.