1
For Private Circulation Only
Technical and Derivatives Review | January 04, 2020
Index consolidates amidst stock-specific momentum
Sensex (41465) / Nifty (12227)
Source: Trading View
Future outlook
During the week gone by, the benchmark index witnessed lethargic move in the first three sessions with some profit booking.
Subsequently, the market then exhibited remarkable recovery on Thursday with the Nifty ending just below the recently marked all-time
high levels (12293.90). The stage was all set on Friday for a gap up opening and extending the optimism however the fresh geopolitical
tensions spooked the sentiment resulting in a weak start on Friday. The Index then crept lower throughout the day and ended with a loss of
around half a percent at 12227 and almost flat on a weekly basis.
After the sharp rally seen in the initial December month from the recent lows of 11832, the prices have now slipped into a consolidation
phase for the last three weeks in a range of 12100-12300. The daily chart depicts this price structure as a formation of a Bullish Flag
pattern. Now as per the pattern, the next momentum move can trigger only above 12300 which can then open doors towards 12400-12500
levels. However, till then the prices may continue to remain in range 12100-12300 with the lower side of the range at 12100 to act as
sacrosanct support. The bias remains positive and hence traders are advised to avoid contra bets and maintain a positive stance.
The key highlight of the week was the strong outperformance by the midcap basket as compared to the benchmark index. The stocks from
the midcap space witnessed stupendous rally and moved intraday 5-7% with ease. This is totally in line with what we have been saying
since the last couple of weeks and at this juncture, with the visibility of ‘Inverse Head and Shoulder’ pattern breakout in the midcap index,
the outperformance is likely to continue in the near term. It seems like a payback time from the Midcap counters which have been
underperforming as compared to front line counters for the past more than 2.5 years and hence, we echo our stance that traders should
continue with the stock specific long approach in the midcap space.
2
For Private Circulation Only
Technical and Derivatives Review | January 04, 2020
No meaningful change in open interest, avoid shorts
Nifty spot closed at 12226.65 this week, against a close of 12245.80 last week. The Put-Call Ratio has decreased from 1.46 to 1.37.
The annualized Cost of Carry is positive at 3.29%. The Open Interest of Nifty Futures has decreased by 1.51%.
Derivatives View
Nifty current month future closed with a premium of 29.80 points against a premium of 73.45 points to its spot. Next month future
is trading with a premium of 71.95 points.
As far as Nifty options activities for the week are concerned, the overall build-up was scattered between 12300-12700 call and
11700-12300 put options. Maximum open interest for the monthly series now stands at 12000 put and 12500 call option.
During the week, we saw some profit booking for the first three consecutive sessions and then on Thursday we witnessed sharp
recovery to inch almost towards 12300 mark. However, the conflict between US and Iraq intensified which resulted in decent profit
booking on Friday. As far as open interest activities are concerned, we hardly saw any fresh build-up in both the indices on a weekly
basis. Due to the geo-political tension, the put writers of 12200-12300 looked fearful and hence covered their positions. This was
followed by fresh writing in 12300-12500 call options. At current juncture, we haven’t witnessed any meaningful shorts in system
and 12150-12200 still remains a strong base for the benchmark index. Thus, we would advise traders avoiding any bearish bets until
we manage to sustain above the mentioned support zone.
Long Formation
Scrip
OI
Futures
OI
Chg (%)
Price
Price
Chg (%)
JUBLFOOD 2633500 25.82 1683.40 2.77
CUMMINSIND 1922400 25.13 575.80 2.16
MINDTREE 1336800 24.24 811.80 4.01
NMDC 25614000 21.52 129.85 2.73
COALINDIA 17085600 19.64 206.70 3.56
Weekly change in OI
Short Formation
Scrip
OI
Futures
OI
Chg (%)
Price
Price
Chg (%)
SUNTV 4902000 27.38 431.80 (4.39)
PEL 4274397 16.57 1526.05 (5.20)
TITAN 11749500 14.52 1145.75 (4.49)
TVSMOTOR 5937300 13.15 447.10 (1.90)
IGL 8593750 12.13 417.00 (2.08)
3
For Private Circulation Only
Technical and Derivatives Review | January 04, 2020
Research Team Tel: 022 - 39357600 Website: www.angelbroking.com
For Technical Queries E-mail: technicalresearch-cso@angelbroking.com
For Derivatives Queries E-mail: derivatives.desk@angelbroking.com
DISCLAIMER
Angel Broking Limited (hereinafter referred to as “Angel”) is a registered Member of National Stock Exchange of India Limited,
Bombay Stock Exchange Limited and Metropolitan Stock Exchange Limited. It is also registered as a Depository Participant with CDSL
and Portfolio Manager and Investment Adviser with SEBI. It also has registration with AMFI as a Mutual Fund Distributor. Angel
Broking Limited is a registered entity with SEBI for Research Analyst in terms of SEBI (Research Analyst) Regulations, 2014 vide
registration number INH000000164. Angel or its associates has not been debarred/ suspended by SEBI or any other regulatory
authority for accessing /dealing in securities Market. Angel or its associates/analyst has not received any compensation / managed
or co-managed public offering of securities of the company covered by Analyst during the past twelve months.
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment
decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should
make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the
companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine
the merits and risks of such an investment.
Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and
trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's
fundamentals. Investors are advised to refer the Fundamental and Technical Research Reports available on our website to evaluate
the contrary view, if any.
The information in this document has been printed on the basis of publicly available information, internal data and other reliable
sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this
document is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any way
responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this
report. Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we
cannot testify, nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this
document. While Angel Broking Limited endeavors to update on a reasonable basis the information discussed in this material, there
may be regulatory, compliance, or other reasons that prevent us from doing so.
Technical and Derivatives Team:
Sameet Chavan Chief Analyst – Technical & Derivatives sameet.chavan@angelbroking.com
Ruchit Jain Technical Analyst ruchit.jain@angelbroking.com
Sneha Seth Derivatives Analyst sneha.seth@angelbroking.com
4
For Private Circulation Only
Technical and Derivatives Review | January 04, 2020
This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced,
redistributed or passed on, directly or indirectly.
Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or
in connection with the use of this information.