F&O Strategy: Buy Macrotech Developers, Britannia, Info Edge suggests Rupak De in a falling stock market today

Stock market today: The equity benchmark indices, Sensex and Nifty 50, fell in early trading on Monday, influenced by declines in Telecom and Industrials stocks against a backdrop of weak global market trends. Additionally, persistent outflows of foreign funds contributed to the market's downturn. In the Asian markets, Shanghai and Hong Kong were experiencing gains. Seoul will be closed due to the Lunar New Year celebrations. The US markets finished lower on Friday.

Foreign Institutional Investors (FIIs) sold shares valued at ₹2,758.49 crore on Friday, based on data from the exchange.

At 11:20 IST, Sensex declined 636.84 points or 0.84% to 75,553.62. The Nifty 50 dropped 208.25 points or 0.90% to 22,883.95.

According to technical analysts, there have been negligible changes in both major indices within the derivatives market. For the upcoming monthly expiry, notable open interest concentration is observed at 23000 PE, followed by 22800 PE, indicating a nearby support level. Conversely, a dispersed open interest positioning is noted from the 23200-23500 CE strikes, indicating possible resistance areas for Nifty 50. The Long-Short Ratio has increased slightly to 20% from 16% week over week, still indicating an oversold scenario.

Technical views by Rupak De, Senior Technical Analyst, LKP Securities on F&O market

Nifty 50

The Indian Nifty 50 remained volatile with a predominantly bearish bias. Sentiment continues to favour the bears as the index once again retreated from the day's high. In the short term, the bears may maintain the upper hand as long as the index fails to surpass the 23,450 level. Any rise toward the 23,350–23,450 zone is likely to encounter selling pressure. However, the downside may remain limited unless the 23,000 level is breached.

Open Interest Analysis:The new weekly series kicked off with significant CALL writing, as evident from the first day's activity in the Nifty 50 weekly options. The net addition to CALL open interest stood at 1.32 crore, compared to a net addition of only 35.39 Lakhs in PUT open interest. Substantial CALL open interest is visible at the 23,500 strike, while maximum PUT open interest is concentrated at 23,000, defining a range for the market.

Strategy:Strong PUT Open Interest addition at 23,000 signifies a strong support. On the higher end 23,500 might act strong. However, since the index is near the support of 23,000, it is likely to move higher in the short term, unless it falls below 23,000.

Trade:Buy Nifty 50 23,300CE above 86 TGT 140 SL 54.

Technical stock recommendations for the week

Buy Britannia Industries Ltd - Target: ₹5,350, Stop Loss: ₹4,980

Britannia has exhibited a breakout from an inverted head and shoulders pattern on the daily chart, signaling a potential bullish reversal in the near term. Support is established at 4,980, and a significant breach below this level could lead to further downside. However, if the stock maintains above the 5,000 mark and sustains its upward momentum, it holds the potential for favorable returns.

Buy Macrotech Developers Ltd (Lodha) - Target: ₹1,200, Stop Loss: ₹1,050

Lodha has found support at the previous swing low, where buying interest is likely to be accumulating. The RSI is currently in the oversold zone and is approaching a bullish crossover. The stock has been closing higher over the last two days, driven by improved sentiment. In the short term, the stock could trend towards 1,200, with support at 1,050.

Buy Info Edge (India) Ltd (Naukri) - Target: 8,200, Stop Loss: 7,190

Naukri has formed a bullish engulfing pattern on the daily chart, with support near the 200-day moving average (DMA). The daily RSI also indicates a bullish crossover. In the near term, the stock could target 8,200, with key support at 7,190.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.