Intriguing market developments were observed in 66 stocks, including prominent names like Apollo Tyres, Max Financial Services, Britannia Industries, Info Edge India, and Laurus Labs. An intriguing pattern emerged as Open Interest (OI) surged alongside a dip in prices, suggesting the emergence of short positions.
The equity market felt the reverberations of the RBI’s liquidity measures and inflation apprehensions once again on August 11. The Nifty50 benchmark encountered a downward trajectory, breaching the 19,500 mark after a four-day consolidation phase. Analysts are eyeing the potential support level around 19,300, a key juncture marked by a horizontal support trendline connecting the lows of July 4 and August 3. A breach of this line might pave the way for a descent towards 19,000. On the contrary, sustaining these levels could lead to a pivotal challenge at the 19,650-19,700 range.
During this session, Nifty50 experienced a 115-point drop, culminating in the formation of a distinctive long bearish candlestick pattern on the daily charts. This pattern was accentuated by the breakage of a long upward sloping support trendline.
Rupak De, an esteemed senior technical analyst at LKP Securities, noted, “The Nifty’s downward trajectory persists as it remains positioned below the 21-day exponential moving average (21EMA – 19,537). Furthermore, the Relative Strength Index (RSI) is indicating a bearish crossover.”
In the short term, De speculates the possibility of the index sliding towards the 19,300 levels. On the flip side, a resistance barrier lies at 19,500, according to his analysis.
The broader market sentiment was mirrored in the performance of key indices. The BSE Sensex witnessed a 365-point drop to 65,323, while the Nifty Midcap 100 and Smallcap 100 indices experienced corrective movements. However, their declines of 0.5 percent and 0.2 percent respectively were relatively moderate compared to the main benchmarks.