Technical and Derivatives Review | January 04, 2019
Index managed to defend key levels
Sensex (35695) / Nifty (10727)
Source: Trading View
Future outlook
The inaugural week of 2019 started well as we were at a kissing distance from surpassing key hurdles. However, global turmoil once
again spooked market participants and hence, we had a couple of terrible days of trade in the midst of the week. Fortunately, some
respite was seen globally on Friday and hence, we eventually ended by reclaiming the 10700 mark.
Friday’s price move was crucial according to us as we were trading precisely at the threshold of two key technical indicators. Firstly,
the 61.8% retracement of the recent up move and then most importantly the ‘Rising Trend Line’ support around 10650 - 10610
levels. Although index breached these levels on intraday basis, the closing is well above it in the relatively safe zone. Also, with such
kind of intraday volatility, we can now see a formation of ‘Bullish Hammer’ pattern around the important support zone. Hence, going
ahead, a sustainable move beyond 10750 would lead to extended rally towards 10850 - 10920 levels. If things go as per the
expectations, we would then be able to see a breakout from recent key hurdles and in this scenario, the much-awaited move
beyond 11000 cannot be ruled out.
Hence, going ahead, as long as 10600 is not broken one should remain on the positive side and better to place positional bets if
things pan out as per above scenario. By doing this, one must keep an eye on global developments also. Even if we see things going
in tandem, it’s better to keep a regular tab on positions and should follow proper exit strategy. On the sectoral front, midcap private
banking space looks encouraging along with the entire midcap universe.
For Private Circulation Only
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Technical and Derivatives Review | January 04, 2019
PSU banks attracting fresh longs
Nifty spot closed at 10727.35 this week, against a close of 10859.90 last week. The Put-Call Ratio has decreased from 1.54 to 1.34.
and the annualized Cost of Carry is positive at 6.33%. The Open Interest of Nifty Futures increased by 14.62%.
Derivatives View
Nifty current month future closed with a premium of 50.25 points against a premium of 47.85 points to its spot. Next month future
is trading with a premium of 84.00 points.
As far as Nifty options activities for the week are concerned, we saw decent open interest addition in 10800-11100, 11300 and
11500 call. Whereas, 10500 and 10700 put options added some fresh positions. Maximum open interest for January series now
stands at 11200 call and 10500 put options.
Our market too corrected along with the global bourses; but sharp recovery on Friday brought index back above 10700 mark . In
F&O space, we saw addition of fresh mixed positions in Nifty; whereas, decent long formation took place in BankNifty. Meanwhile,
put writers continued adding decent positions in 10500-10700 strikes. Since last three consecutive sessions, the premiums for Nifty
futures have been consistently increasing, indicating buying interest near the support zone of 10600-10650. Going ahead, we expect
extension of Friday’s rally towards 10850-10900; thus, traders are advised trading with a positive bias.
Long Formation
Short Formation
OI
OI
Price
OI
OI
Price
Scrip
Price
Scrip
Price
Futures
Chg (%)
Chg (%)
Futures
Chg (%)
Chg (%)
UNIONBANK
41713000
10.72
92.85
7.65
JETAIRWAYS
8023400
34.72
237.35
(13.20)
BANKINDIA
29442000
18.07
109.50
5.64
EICHERMOT
395525
55.18
20240.80
(13.12)
YESBANK
164312750
3.83
190.95
4.52
M&M
17668000
36.33
728.90
(9.79)
BEL
36648000
7.84
90.90
4.36
L&TFH
20650500
20.76
145.40
(6.47)
UJJIVAN
3536000
16.01
285.35
3.90
MINDTREE
2903400
30.61
817.30
(5.90)
Weekly change in OI
For Private Circulation Only
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Technical and Derivatives Review | January 04, 2019
Technical and Derivatives Team:
Sameet Chavan
Chief Analyst - Technical & Derivatives
[email protected]
Ruchit Jain
Technical Analyst
[email protected]
Rajesh Bhosale
Technical Analyst
[email protected]
Sneha Seth
Derivatives Analyst
[email protected]
Research Team Tel: 022 - 39357600
Website: www.angelbroking.com
For Technical Queries
E-mail: [email protected]
For Derivatives Queries
E-mail: [email protected]
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