The benchmark Indian stock market closed volatile on Friday and rose slightly. Buying orders in financial, IT, and oil and gas stocks were offset by sell-offs in auto and pharmaceutical stocks.

Nifty Bank rose 0.7% and closed up 6.4% this week, which is the biggest weekly gain since May 2021.

What do the charts suggest for Dalal Street now?

According to HDFC Securities Technical Research Analyst Nagaraj Shetti, Nifty50 has formed a small solid positive line with upper and lower shadows on the daily chart, indicating a high wave pattern reflecting volatility.

“On the weekly chart, the index has formed a long bull candle with negation of a bearish weekly pattern of lower highs and lower lows. This is a positive sign,” he said. All hunky-dory above 17,700

The Nifty is comfortably trading above the 50-day simple moving average, which is broadly positive, said Amol Athawale, Deputy Vice President-Technical Research at Kotak Securities.As long as it is trading above 17,700, the uptrend formation may continue up to 17,920-18,000 levels, and any further upside may take it to 18,100-18,175 levels, he said. However, Athawale also said the possibility of a quick correction up to 17,600-17,525 is not ruled out if the Nifty50 closes below 17,700.

Here are key things to know about the market before the January 10 session:

SGX Nifty

Singapore Exchange (SGX) Nifty futures – an early indicator of the Nifty index – were up 86.5 points, or 0.5%, at 17,943.5 at 7.43am on Monday, signaling an imminent opening on Dalal Street.

Global markets

Shares in other Asian markets were mixed on Monday as investors saw the penultimate U.S. inflation data, which is likely to set the stage for an early rate hike by the Federal Reserve. MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.2% at last count. Hong Kong’s Hang Seng gained 0.3% and Singapore’s Straits Times gained 1.1%, but China’s Shanghai Composite lost 0.3% and South Korea’s KOSPI lost 1.1%.

S&P 500 futures were flat in Asia.

Wall Street’s main indexes fell sharply on Friday after U.S. jobs data, which showed U.S. payrolls rose less than expected last month. The S&P 500 lost 0.4% and the Nasdaq Composite lost 1%. The Dow Jones was flat.

What to expect on Dalal Street

HDFC Securities’ Shetti believes the short-term trend of the Nifty50 remains positive. “The uptrend strength remains intact and we are unlikely to see any sharp decline… Any weakness from here could be a buying opportunity around the crucial support of 17,600… Immediate resistance is placed at 17,900,” he said.The Nifty appears to be forming a symmetrical triangle pattern on the daily timeframe, according to independent technical analyst Manish Shah.

“The undertone of the market is bullish and the current pause is a regular feature… The index needs to trade above resistance at 17,950 for the rally to continue and this could lead to a surge to major resistance at 18,250-18,300 levels,” said Shah, who remains bullish on the market as long as the Nifty holds the support level of 17,600. 

Key levels to watch out forNifty50: The 50-scrip index has immediate support at 17,500 and resistance at 18,000, according to Mohit Nigam, Head-PMS at Hem Securities.Bank Nifty: For the banking index, he sees support at 37,000 and resistance at 38,200.FII/DII activityForeign institutional investors (FIIs) net purchased Indian equities worth Rs 496.3 crore on Friday. However, net sales by domestic institutional investors stood at Rs 115.7 crore, according to provisional exchange data.December was a third straight month of FII outflows for Indian equities.Call/put open interestExchange data shows the maximum call open interest is accumulated at the strike price of 18,000, with 91,700 contracts, and the next highest at 18,500, with some 70,400 contracts. On the other hand, the maximum put open interest is placed at 17,500, with 83,000 contracts.This suggests immediate resistance at 18,000, followed by another major hurdle at 18,500, and support only at 17,500.

Complete News Source : CNBC