Gap-up Opening After Correction? What Next? Share Market Today

News Shots

Wipro acquired cybersecurity consulting provider Edgile that focuses on risk and compliance, information and cloud security, and digital identity for Rs 1,745 crore.

CCI approves the acquisition of up to 16.94% equity share capital in IRB Infrastructure by Bricklayers Investment (GIC).

RailTel received a work order from DRDO worth Rs 68.3 crore. The entire work is to be completed in seven months.

Bharti Airtel lost net 4,89,709 mobile users in October according to TRAI.

Reliance Jio added a net 1.76 million mobile users in October.

Jubilant Ingrevia issued commercial papers of Rs 100 crore.

Adani Enterprises said it has received the letter of award from Uttar Pradesh Expressways Industrial Development Authority to implement three major stretches of the greenfield Ganga Expressway.

What to expect?

Yesterday, NIFTY opened with a huge gap-down at 16,840. It was a bloodbath in the market with NIFTY falling till 16,410, bouncing from there to recover some points. The index closed the day at 16,614, down 371 points or 2.18%

BANK NIFTY opened the day with a gap-down at 35,226 and fell heavily. Support was taken at 34,000 and the index closed at 34,440, down 1179 points or 3.31%.

All the sectors closed deep in the red. REALTY was 4.9% down.

The US markets and the European markets closed deep in the red due to the same reason, Omicron worries.

The Asian markets are trading in the green now. The U.S. Futures and the European Futures also are in the green.

SGX NIFTY is trading at 16,814 indicating a gap-up opening in NIFTY.

Major supports for NIFTY are at 16,600, 16,500, 16,410, 16,380, 16,280 and 16,230. We can expect resistances at 16,700, 16,780, 16,840, 16,900 and 17,000.

BANK NIFTY has supports at 34,400, 34,000, 33,900 and 33,600. Resistances are at 34,600, 34,800, 35,000, 35,230 and 35,350.

NIFTY has the largest call OI build-up at 17,000 and the largest put OI build-up at 16,000.

BANK NIFTY has the highest call OI build-up at 36,000 and the highest put OI build-up at 34,000.

Option writers too are waiting for the indices to settle a bit.

INDIA VIX has increased by 16% to 18.97, being the fear index.

Foreign Institutional Investors net sold shares worth Rs 3,565 crores. Domestic Institutional Investors net bought shares worth Rs 2,764 crores.

Omicron worries have deeply hurt the market sentiments. The UK government is on a plan to tighten the restrictions before Christmas. Netherlands has announced Christmas lockdown in the country.

NIFTY has retraced more than 10% from the all-time high. The much-expected correction has happened but with a bloodbath. BANK NIFTY has almost reached the Pre-Covid level. The index was much more bearish than NIFTY.

Since there is recovery in the Asian markets and the global futures, we can expect a gap-up opening. But will the gap-up be sold into is the question. Even if the market moves up in the beginning, it will face stiff resistance at around 16,850 in NIFTY and 35,250 in BANK NIFTY. If that happens, there is a chance for further fall. 16,400 and 34,000 can act as strong supports in this case.