Technical Picks |
May 2, 2015
Nifty trading at crucial levels - a minor bounce likely
Sensex (27011) / Nifty (8181)
The week kicked off on a positive note on Monday on back of
Exhibit 1: Nifty Weekly chart
positive global clues, but from initial trades, we witnessed follow-
up selling pressure of the preceding two weeks. We saw some
breather on Tuesday. However, the move from 8185 to 8308
on the Nifty on Tuesday turned out to be just a pullback of the
current downtrend and we witnessed immense selling pressure
at higher levels during the remaining two sessions of the week.
On the sectoral front, FMCG, Metals and Infra were the most
beaten down sectors whereas Banking and Auto counters
positively outperformed the index. The Nifty ended the concluded
Source: Falcon
week with a sharp cut of 1.49% over the previous week's closing.
Exhibit 2: Nifty Daily chart
Pattern formation:
The '89-day EMA' and the '89-week EMA' are placed at
28182 / 8515 and 25150 / 7558 levels, respectively.
The '20-day EMA' and the '20-week EMA' are placed at
27974 / 8445 and 28103 / 8492 levels, respectively.
Future outlook
We witnessed yet another week clearly dominated by the bears
as three out of four trading sessions of the truncated week ended
Source: Falcon
well inside the negative territory. As stated in our previous report,
8269 is a crucial support for the Nifty. The same has been
level of the recent rise from 8269 to 8844.80 (shown in the
breached on Monday and the Nifty extended its fall to confirm
chart). Also, the '200 days EMA' is placed near to this level
a 'Lower Top Lower Bottom' formation on the weekly chart for
which could act as a support in the coming days. The advance
the first time since August 2013. In addition, the 'Head &
to decline ratio in the last three trading sessions is showing
Shoulder' pattern breakdown on the weekly chart is also acting
some strength. Hence, a possibility of consolidation or a minor
as a spoilsport for the bulls. This would certainly not bode well
bounce from current levels cannot be ruled out. Directionally,
for the bulls in the medium term. The Nifty is hovering near
the view remains bearish and traders who are waiting to go
8100 - 8150 levels which is the lower range of the 'falling
short in the market can use the bounce to create short positions.
wedge', which coincides with the 127% Reciprocal retracement
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Technical Picks |
May 2, 2015
Weekly Pivot Levels For Nifty 50 Stocks
SCRIPS
S2
S1
PIVOT
R1
R2
SENSEX
26,609
26,810
27,189
27,390
27,768
NIFTY
8,031
8,106
8,220
8,296
8,410
BANKNIFTY
17,477
17,907
18,170
18,600
18,863
ACC
1,351
1,392
1,470
1,511
1,588
AMBUJACEM
215
224
233
241
250
ASIANPAINT
711
737
756
782
801
AXISBANK
493
530
556
594
620
BAJAJ-AUTO
1,860
1,904
1,957
2,002
2,054
BANKBARODA
163
166
170
173
178
BHEL
217
227
235
246
254
BPCL
693
729
756
792
819
BHARTIARTL
350
365
387
403
425
CAIRN
201
207
214
220
226
CIPLA
609
622
632
646
656
COALINDIA
347
355
367
375
388
DRREDDY
3,129
3,220
3,367
3,458
3,606
GAIL
344
352
361
369
378
GRASIM
3,450
3,520
3,605
3,675
3,760
HCLTECH
829
855
880
906
932
HDFCBANK
960
974
993
1,008
1,027
HDFC
1,100
1,135
1,195
1,230
1,290
HEROMOTOCO
2,244
2,286
2,338
2,381
2,433
HINDALCO
124
126
130
132
135
HINDUNILVR
792
821
861
891
931
ICICIBANK
283
307
321
345
359
IDEA
157
166
183
192
209
IDFC
159
164
166
171
174
INDUSINDBK
788
806
824
842
860
INFY
1,889
1,916
1,959
1,985
2,029
ITC
301
312
332
342
362
KOTAKBANK
1,251
1,292
1,338
1,379
1,425
LT
1,581
1,606
1,651
1,676
1,721
LUPIN
1,645
1,709
1,747
1,811
1,849
M&M
1,104
1,124
1,158
1,179
1,213
MARUTI
3,354
3,540
3,706
3,893
4,059
NMDC
123
126
128
131
133
NTPC
144
147
150
153
157
ONGC
294
299
308
314
323
POWERGRID
136
139
143
147
151
PNB
151
155
159
163
167
RELIANCE
826
844
866
884
906
SSLT
196
203
209
215
221
SBIN
259
264
270
276
282
SUNPHARMA
891
915
936
960
981
TCS
2,377
2,421
2,470
2,513
2,563
TATAMOTORS
489
499
516
526
543
TATAPOWER
72
74
76
79
81
TATASTEEL
346
353
366
373
386
TECHM
543
582
604
644
666
ULTRACEMCO
2,528
2,600
2,698
2,770
2,868
WIPRO
506
522
534
551
563
YESBANK
786
813
831
858
876
ZEEL
302
307
316
321
330
Technical Research Team
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Derivatives Review |
May 2, 2015
It's a sell on rise market
Nifty spot closed at 8181.50 this week against a close of 8305.25 last week. The Put-Call Ratio has increased from 0.83 to 0.95 levels
and the annualized Cost of Carry is positive at 9.97%. The Open Interest of Nifty Futures decreased by 11.50%.
Put-Call Ratio Analysis
Implied Volatility Analysis
PCR-OI has increased from 0.83 to 0.95 levels. Being start of
Implied Volatility (IV) for NIFTY has decreased from 17.46%.to
new series over all buildup is quite scattered. Huge buildup
16.56%. Historical volatility (HV) of NIFTY is at 17.72% and
was visible in 8200-8600 call options and in 7800-8000 put
that for BANKNIFTY is trading at 25.03%. Liquid counters having
options. Some open interest addition was also seen in deep
very high HV are WOCKPHARMA, ICICIBANK, M&MFIN, UBL
out the money call options in the range of 8900-9000 strikes.
and JSWENERGY. Stocks where HV are on lower side are CESC,
Maximum buildup in current series is seen in 8800 call & 8100
SUNTV, ABIRLANUVO, BATAINDIA and TCS.
put options.
Open Interest Analysis
Cost-of-Carry Analysis
Total open interest of market has decreased from
Nifty current month futures closed at a premium of 62.55 points
`2,50,162/- cr. to `1,69,491/- cr. Stock futures open interest
against the premium of 66.80 points to its spot. Next month
has decreased from `69,069/- cr. to `60,552/- cr. Liquid
future is trading with premium of 93.80 points. Liquid counters
counters names which added significant positions last week
where CoC is high are CENTURYTEX, GMRINFRA, MRF,
are HDFC, YESBANK, ITC, HINDUNILVR and RELIANCE. On
JPPOWER and INDIACEM. Stocks with negative CoC are
the other hand unwinding was visible in counters like ICICI
PETRONET, GODREJIND, IBULHSGFIN, BHEL and ALBK.
BANK, DLF, BANKBARODA, MARUTI and INFY.
Derivative Strategy
Scrip : RELIANCE
CMP : `860.35
Lot Size : 250
Exercise Date (F & O) :
28th. May 2015
View: Mildly Bullish
Strategy: Bull Call Spread
Expected Payoff
Buy/Sell
Qty
Scrip
Strike
Series
Option
Buy/Sell Rate
Closing Price
Expected
Price
Type
(`)
(`)
Profit/Loss
BUY
250
RELIANCE
880
MAY
CE
16.00
855
(`9.00)
SELL
250
RELIANCE
920
MAY
CE
7.00
872
(`9.00)
BEP
-
`889/-
889
0.00
Max. Risk: `2,250/-
Max. Profit: `7,750/-
906
`17.00
If RELIANCE continues to move below BEP on expiry.
If RELIANCE closes on or above `920/-
923
`31.00
NOTE: Profit can be booked before expiry if RELIANCE moves in favorable direction and time value decays.
940
`31.00
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Weekly
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E-mail: [email protected]
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Ratings (Based on expected returns
Buy (> 15%)
Accumulate (5% to 15%)
Neutral (-5 to 5%)
over 12 months investment period):
Reduce (-5% to -15%)
Sell (< -15