Trade Setup For Oct 10: Nifty Could Rise To 25,150-25,350 If It Holds Above 24,690

Indian stock indices saw a positive start on Wednesday but failed to keep momentum in the second half due to profit booking. However, analysts believe the Nifty 50 could rise to 25,150–25,350 if it holds above Wednesday's low.

"On the daily chart, the Nifty formed a small red candle, followed by an insider bar candlestick, and it managed to hold above the short-term trend line support. If the index holds above the low of 24,690, it could rise, but a close below the level could lead to a fresh breakdown," said Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Intermediates Ltd.

The index would find support at 24,750, while the resistance level would be at 25,200, he said.

"For the bulls now, 50-day SMA or 25,050 would be the key level to watch out," said Shrikant Chouhan, head equity research, Kotak Securities. He also said that, since the current market texture is volatile, a level-based trading strategy is ideal for the traders.

In the second half, Bank Nifty continued to face pressure, forming a small red candle and then an insider bar candlestick. Yedve suggested a buy-on-dips strategy as long as the Bank Nifty index holds above the 50,190 levels. He also said that on the upside, 51,700-51,800 could act as a short-term hurdle for the index.

The GIFT Nifty, an early indicator of the Nifty 50 Index’s performance in India, was up 8.5 or 0.03% at 25,197 as of 06:32 a.m.

The Nifty October futures fell by 0.67% to 24,985.55 at a premium of 189.8 points, while open interest grew by 0.29%.

The Nifty Bank October futures fell by 1.55% to 51,016.25 at a premium of 537.35 points, while open interest grew by 17.65%.

The open interest distribution for the Nifty 50 Oct. 10 expiry series indicated most activity at 27,950 call strikes, with 23,100 put strikes having maximum open interest.

For the Bank Nifty options expiry on Oct. 9, the maximum call open interest was at 62,000 and the maximum put open interest was at 43,000.

Overseas investors, commonly known as Foreign Portfolio Investors, or FPIs, remained net sellers of Indian equities for eight consecutive sessions on Wednesday, while domestic institutional investors (DIIs) bought stocks worth Rs 3,508.61 crore.

According to provisional data from the National Stock Exchange (NSE), FPIs offloaded stocks worth Rs 4,562.71 crore.

Benchmark equity indices fell back into negative territory after a brief rally, erasing morning gains in the last hour of trade to close near their lowest levels on Wednesday.

During the day, the indices had climbed by as much as 1.2% following the RBI's monetary policy meeting, which shifted its liquidity stance to 'neutral' from the previous 'withdrawal of accommodation,' suggesting a possible rate cut. On expiry day, the weekly futures contract for Nifty Bank remained flat.

The Nifty closed down 0.12%, or 31.20 points, at 24,981.95, while the Sensex decreased by 0.21%, or 167.7 points, to finish at 81,467.10.

• Adani Enterprises: The company announced the launch of its Rs 4,200 crore qualified institutional placement offer at a floor price of Rs 3,117.47 per share. The floor price is at a discount of 6.08% of the closing price of Rs 3,153.75 per share on NSE. The company will issue 1.42 crore shares having a face value of Rs 1 each.

• PNC Infratech: The construction has emerged as the "lowest bidder" for a Rs 2,091 crore infrastructure project near the upcoming Navi Mumbai Airport.

• Star Health and Allied Insurance Co.: The company acknowledges that they were the victim of a targeted cyberattack. It added that operations remain unaffected and all services continue without disruption. The company, in a statement to NDTV Profit, said that it has not as of yet found any evidence of wrongdoing from their Chief Information Security Officer following its investigation into the data breach the company suffered due to a cyberattack.

Stocks in the Asia-Pacific region rose in early trade, mirroring record highs on Wall Street in the run-up to the crucial inflation report on Thursday.

The Japanese benchmark Nikkei 225 was 212 points, or 0.5% higher at 39,503, while Australia's S&P ASX 200 was up 44 points or 0.54% at 8,231 as of 5:44 a.m.

Stocks in Mainland China snapped their 10-day record rally on Wednesday to post the biggest decline in more than four years, raising concerns if the bull run will be sustained. The doubts in the rally come as investors were disappointed by the lack of any anticipated big measures to revive the economy

Meanwhile, the US Federal Reserve's latest minutes show that officials are in no rush for another half-point cut as long as the labour and employment numbers are strong.

Equity benchmarks in the US posted another fresh high on Wednesday ahead of the CPI data that might decide the magnitude of the next rate cut by the Fed. The S&P 500 index hit its 44th record in 2024.

The S&P 500 and Nasdaq Composite advanced 0.71% and 0.60%, respectively. The Dow Jones Industrial Average climbed by 1.03%.

Brent crude was trading 0.40% higher at $76.89 a barrel as of 6:03 a.m. IST. West Texas Intermediate was up 0.45% at $73.57.

• US Dollar Index at 102.87

• US 10-year bond yield at 4.07%.

• Brent crude up 0.46% at $76.93 per barrel.

• Bitcoin was 0.05% down at $60,365.44

• Gold spot was up 0.08% at $2,609.9

Ahead of the Oct. 31 expiry, the value of outstanding positions—also called open interest in the derivatives segment—has decreased for the FIIs in Nifty Futures.

FIIs sold index options worth Rs 36,408 crore, stock options worth Rs 6,879 crore, index futures worth Rs 3,652 crore, and Rs 2,154 crore in stock futures.

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