Market Analysis for 18-Feb-2022

Global news/concerns:

1. As a norm lately, either RUS-UKR conflict or tapering off news will keep US market and other markets volatile. Last night, it was renewed concern about RUS-UKR
2. US 10 years bond yield has eased up a bit. Given that this usually goes up in case of concerns in stock market, this is strange that it is held steady. May be, Fed is taking this as an opportunity to sell some off.
3. Oil prices down for two days in a row, a good news for importers like India. This is mainly due to talks with Iran which could lead to extra supply. Still a speculation.
4. Gold price is increasing constantly meaning investors are looking for safe heaven.

India news/concerns:

1. On 17th Feb, a news from a Russian site regarding Ukraine bombing some rebel sites created a negative sentiment during market hours. That, along with expiry, increased volatility a lot and nifty expired around 17300 which was anticipated a day earlier based on option chain analysis.
2. In F&O space, retailers have taken mostly a bullish stance against mixed to bearish stance of FII and Pro. But this is early days for Feb expiry week and mostly positions get confirmed by the end of Friday.
3. FII again around 1200 crore on 17-Feb and DII consumed 900 crore out of it.

Technical:

1. On 17-Feb, Nifty confirmed the support at around 17260 and that is weak now after several testing. Breaking this will make Nifty test 17150 and 17050. Any daily close below 17150 will be catastrophic.
2. US market had a poor show on 17-Feb and Dow closed 1% down.
3. SGX Nifty closed the night before with some losses after closing of Indian market.
4. Nifty option chain suggests, major resistance is already created at 17400 and 17500 levels. Good amount of call and put writers at 17300 still. Whoever will blink first, market will give a good move in that direction. Some support at 17200 but major one at 17000 level. OI chain analysis can be done in live market using sites like tradingtick or opstra.

Expectation:

1. Market likely to open gap down by 50-100 points taking support at 17150 level. After initial pressure, it should recover in the second half. Still do not see Nifty breaking high of 16th Feb. Banknifty, on the other hand, is already showing signs of weakness in daily chart but near its support which will surely be broken at the start of 18-Feb.
2. In 4 hour chart, we took support from lower trendline and then resistance near the upper trendline. Waiting for a breakout or breakdown.