If you have a look at Monday’s closing degree on the Nifty 50, chances are you’ll wonder if the market even traded on Monday. However, the index travelled each methods by the session, reversing from helps and going through bother in resistance zones. Perfectly respecting the vary.

The Nifty 50 ended 70 factors larger than the intraday low of 19,601 and 60 factors off the day’s excessive of 19,734. The 130-point vary showcased the proper bulls versus bears battle on the road in the beginning of the September F&O sequence expiry week.

While Infosys, Reliance and TCS dragged the index decrease, the financials, led by Bajaj Finance, ICICI Bank, Kotak Bank and final week’s prime loser HDFC Bank ensured that the Nifty 50 doesn’t break under key assist ranges.

What Are The Experts Saying?

“India is heading (and already entered) a new upcycle which will last for several years. Any corrections were characterized as the end of a cycle. The reality is that all the signs suggest that we are in that phase and a similar disbelief on a cycle remains. Until we see a case arguing against the room for a cycle, we prefer remaining as buyers on any correction in the equity markets. Financials and capex-linked stories will lead the cycle followed by a broader recovery in consumption,” stated Venugopal Garre of Bernstein.

Ridham Desai of Morgan Stanley wrote that the opening up of sovereign bond market and the resultant inflows are more likely to be useful for Indian equities as a result of constructive affect of progress. “In terms of sector preferences, we like Financials and Consumer discretionary and would avoid global materials,” he wrote.

What Do The Nifty 50 Charts Indicate?

Well, the Nifty 50 has barely moved from Friday’s ranges, respecting each the 19,600 assist on the draw back, and going through stress close to the resistance zone of 19,750.

Nagaraj Shetti intends to look at 19,580 as a key degree on the draw back for the Nifty 50 as that has provided a robust assist for the Nifty 50 over the past 3-4 months. Hence, he expects an upside bounce on the index within the close to time period with upside resistance seen at ranges of 19,850.

“The Nifty 50 has remained volatile before closing with a doji patten on the daily chart, said Rupak De of LKP Securities. This suggests a possible pause in the prevailing bearish trend. He expects the market to consolidate before starting a new trend. De sees new short positions only on a break below 19,600 with an upside resistance seen at 19,755.

Mehul Kothari of Anand Rathi said that the 19,600 level is the make or break level for both bulls and bears of the Nifty 50. A fall below that may extend the selling pressure, while holding these levels could lead to potential upsides towards 19,800.

Will The Nifty Bank Start To Step Up?

Monday was a topsy turvy day for the Nifty Bank. While one can take heart from the fact that HDFC Bank, Kotak Bank and ICICI Bank ensured the Nifty 50 stayed where it was, it still could not cross the 45,000 mark on the upside, reversing from 44,936. The index eventually closed nearly 200 points off the day’s high but still managed to outperform the Nifty 50.

Kunal Shah of LKP Securities said that the index continues to remain below its 20-DMA despite some traction from lower levels. He expects resumption of the upward momentum only after the Nifty Bank closes above the 45,000 mark. Support on the downside now rests between 44,500 – 44,000 and a breach of this support range could result in additional selling pressure on the index, Shah said.

Anand Rathi’s Kothari also cited 44,400 as a key level for the Nifty Bank, below which the selling pressure may intensify. Upward momentum will resume only on a close above the 45,000 mark.

Delta Corp’s Mounting Troubles

The stock of Monday’s trading session but for the wrong reasons was Delta Corp. The stock ended 17 percent lower on Monday after it received GST demand notices worth nearly Rs 17,000 crore. This replicated July 12’s 23 percent drop it had when GST rates on casinos were raised. The stock also saw a large block deal, in which 1.7 crore shares worth Rs 236 crore exchanged hands. The stock is now out of the F&O ban list from today’s session.

Gurmeet Chadha of Complete Circle told CNBC-TV18 that he would not be a “braveheart” and look to buy Delta Corp now. “Probably at some stage in time the valuation will turn out to be very very low cost however that is going to be an extended authorized battle. This is the danger with SIN shares, that regulatory intervention, tax calls for, that’s at all times a threat,” he said. Among the SIN stocks he likes, Chadha mentioned ITC and United Spirits.

What Are The F&O Cues Indicating?

Nifty 50’s September futures added 3.3 percent in Open Interest on Monday. Current rollovers are at 34.6 percent. The futures are trading at a premium of 25.95 points compared to 34 points earlier. The Nifty Bank’s September futures added 6.7 percent in Open Interest with current rollovers at 42 percent. Nifty 50’s Put-Call Ratio is now at 0.91 from 0.93 earlier.

Balrampur Chini has entered the F&O ban list, while Delta Corp and Manappuram Finance are out of the ban period. Indiabulls Housing Finance, Hindustan Copper, Canara Bank and Granules India continue to remain in the ban list.

Nifty 50 on the Call side for September 28 expiry:

For this Thursday’s expiry, the Nifty 50 call strikes between 19,650 and 19,900 have seen Open Interest addition. The 19,700 strike has seen the maximum addition in Open Interest.

Nifty 50 on the Put side for September 28 expiry:

On the downside, the Nifty 50 put strikes between 19,400 and 19,600 have seen Open Interest addition, with the 19,400 strike seeing the maximum addition.

Lets take a look at the stocks that saw short covering on Monday, meaning an increase in price but decrease in Open Interest:

Lets look at the stocks that saw unwinding of long positions on Monday, meaning a decrease in both price and Open Interest:

Here are the stocks to watch out for ahead of Tuesday’s trading session: