Technical Picks | November 5, 2016
Markets will be under pressure for some more time; 8550 - 8600 hard to beat
Sensex (27274) / Nifty (8434)
Post the Muhurat trading session on Diwali, the Nifty index
Exhibit 1: Nifty Weekly chart
started Tuesday's session marginally higher. However, the
tug-of-war between bulls and bears led to a flat closing,
ending the session for the day. The bears then took a charge
with a massive gap down opening on Wednesday to breach
the crucial support of 8550 level. In the rest of the trading
sessions, the bears completely dominated the market
proceedings and the selling pressure intensified by the end
of the week. The Nifty index lost 2.23 percent over its
previous week's close, wherein all the sectoral indices except
FMCG ended in red.
Key Moving Averages:
Source: Company, Angel Research
The ’89-day EMA’ and the ’89-week EMA’ for the
Sensex/Nifty are placed at
27727
/
8548 and
Exhibit 2: Nifty Daily chart
26682 / 8085 levels, respectively.
The ’20-day EMA’ and the ‘20-week EMA’ for the
Sensex/Nifty are placed at
27856
/
8614 and
27655 / 8526 levels, respectively.
Future outlook
Despite being a truncated week post Diwali holidays, our
markets have seen good amount of price action.
Unfortunately, it was not in favour of the bulls as the Nifty
eventually slipped below the recent rock solid support of
8500 level. With reference to our recent articles, this move
Source: Company, Angel Research
was not surprising as we have been quite vocal on taking a
cautious stance since last six weeks. In fact it played out quite
All these observations provide credence to our advised
well for us as the Nifty sneaked below the psychological
cautious stance and hence, we expect the index to remain
support of 8500 and now has closed convincingly below it
under pressure for some more time. On the downside, a
on a weekly basis.
continuation of this move towards 8287 - 8162 cannot be
ruled out. Short term traders are advised not to create
Technically speaking, although, the index managed to hold
positions against the ongoing momentum as 8550 - 8600
the lower end of the ‘Falling Wedge/ Channel’ pattern, we
level would now act as a strong resistance for the index. We
would give more weightage to the break of 8500. When
reiterate that this corrective move was essential for the
such an important level is violated, we rarely see index
market and can be construed as a healthy development in
immediately taking a u-turn. The daily chart exhibits a
order to start fresh the upward leg of the rally with a long
breakdown from ‘Head and Shoulder’ neckline level (8500),
term perspective.
which coincides with the daily ’89 EMA’ as well. On one time
frame higher degree (weekly) chart, the Nifty has closed
below the
’20 EMA’ along with the ‘RSI-Smoothened’
slipping below the 70 mark for the first time in last five
months.
For Private Circulation Only
1
Technical Picks | November 5, 2016
Weekly Pivot Levels For Nifty Constituents
SCRIPS
S2
S1
PIVOT
R1
R2
SENSEX
26,663
26,969
27,499
27,805
28,335
NIFTY
8,232
8,333
8,501
8,602
8,771
NIFTY BANK
18,573
18,816
19,204
19,446
19,834
ACC
1,443
1,467
1,498
1,521
1,552
ADANIPORTS
270
279
293
302
317
AMBUJACEM
230
236
241
246
251
ASIANPAINT
1,000
1,022
1,055
1,076
1,110
AUROPHARMA
635
681
754
801
873
AXISBANK
458
469
478
488
498
BAJAJ-AUTO
2,722
2,768
2,816
2,862
2,910
BANKBARODA
131
137
147
153
163
BHEL
127
131
137
141
147
BPCL
604
624
652
672
700
BHARTIARTL
294
300
310
317
327
INFRATEL
328
346
365
383
402
BOSCH
20,148
20,829
21,603
22,285
23,059
CIPLA
513
529
554
570
596
COALINDIA
301
308
320
327
339
DRREDDY
2,874
2,977
3,169
3,272
3,464
EICHERMOT
22,663
23,296
24,409
25,042
26,154
GAIL
406
415
428
438
451
GRASIM
828
864
921
958
1,015
HCLTECH
746
771
785
809
823
HDFCBANK
1,214
1,229
1,246
1,261
1,279
HDFC
1,344
1,365
1,398
1,420
1,453
HEROMOTOCO
3,163
3,226
3,313
3,376
3,463
HINDALCO
142
150
158
167
175
HINDUNILVR
814
831
849
866
883
ICICIBANK
257
264
272
278
286
IDEA
68
70
74
76
80
INDUSINDBK
1,164
1,191
1,214
1,242
1,264
INFY
934
952
980
998
1,025
ITC
226
237
247
259
268
KOTAKBANK
773
787
803
816
833
LT
1,348
1,384
1,433
1,468
1,517
LUPIN
1,302
1,361
1,453
1,512
1,604
M&M
1,268
1,320
1,356
1,408
1,444
MARUTI
5,475
5,590
5,782
5,897
6,089
NTPC
147
150
154
157
161
ONGC
253
261
273
282
294
POWERGRID
166
170
175
178
183
RELIANCE
965
985
1,021
1,041
1,076
SBIN
227
235
248
256
269
SUNPHARMA
581
616
683
718
784
TCS
2,223
2,277
2,338
2,392
2,453
TATAMTRDVR
310
323
338
350
365
TATAMOTORS
481
497
517
533
554
TATAPOWER
71
73
76
78
82
TATASTEEL
383
393
408
419
434
TECHM
406
418
427
439
448
ULTRACEMCO
3,716
3,785
3,888
3,957
4,059
WIPRO
432
442
454
465
477
YESBANK
1,113
1,155
1,214
1,256
1,315
ZEEL
482
494
508
520
534
Technical Research Team
For Private Circulation Only
2
Derivatives Review | November 5, 2016
Implied volatility on lower side, buy At-The-Money puts
Nifty spot closed at 8433.75 this week, against a close of 8638.00 last week. The Put-Call Ratio has decreased from 0.99 to 0.92
levels and the annualized Cost of Carry is positive at 5.29%. The Open Interest of Nifty Futures decreased by 0.47%.
Derivatives View
Weekly OI gainers
OI
OI
Price
Scrip
Price
Nifty current month future closed with a premium of 24.45
Futures
Chg (%)
Chg (%)
points against a premium of 29.40 points to its spot. Next
DISHTV
52724000
57.08
87.50
(10.49)
month future is trading with a premium of 76.15 points.
UBL
1703800
42.09
878.35
(0.59)
PCR-OI has decreased from 0.99 to 0.92 levels. In call
GLENMARK
2704100
23.97
870.85
(10.30)
options 8400-8800 strikes were active and they also added
LICHSGFIN
10096900
23.97
535.00
(9.37)
decent build-up. 9000 call options also added huge positions
last week. On the other hand in put options, 8100-8400
ALBK
18840000
22.18
72.30
(4.93)
strikes added good amount of open interest. Highest open
DABUR
8752500
21.60
297.85
2.74
interest in November series is placed at 9000 call and of put
BANKINDIA
25170000
21.52
105.70
(7.36)
options has been shifted to 8200 strike price.
Stock that added longs last week are VEDL, CAIRN, ITC,
SUNPHARMA
31089500
20.94
654.25
(11.32)
DABUR and TORNTPOWER. While, fresh shorts were visible in
DISHTV,
LICHSGFIN,
GLENMARK,
SUNPHARMA
Weekly OI losers
and UNIONBANK. Liquid counters with higher CoC are
BOSCHLTD, HDFCBANK, TATAPOWER, AMBUJACEM and
OI
OI
Price
Scrip
Price
Futures
Chg (%)
Chg (%)
ADANIPORTS. Stocks with negative CoC are JUSTDIAL,
STAR
1789000
(23.12)
1066.90
0.47
WOCKPHARMA, CROMPGREAV, IDBI, BANKINDIA.
OIL
1264800
(20.94)
402.15
(4.06)
Last week, Nifty plunged more than two percent and closed
below its strong support zone of 8500-8550 levels. FIIs too
MRF
38670
(19.13)
50175.00
0.10
actively participated in this fall. They unwounded good
HEROMOTOCO
1228200
(17.36)
3290.85
(2.66)
amount of long positions and also added fresh shorts in Index
CROMPGREAV
8568000
(16.30)
76.55
(1.23)
Futures. While in options front, they bought good amount of
put options last week. We have upcoming event (US
ARVIND
6152000
(16.23)
400.65
(4.19)
Presidential election) next week, but implied volatility is still on
MARUTI
1778400
(15.48)
5731.95
(2.65)
the lower side. This indicates traders not expecting any major
INFRATEL
3196200
(14.85)
364.90
2.18
movement. However, looking at the FIIs data, we believe Nifty
may continue to remain under pressure.
Weekly change in OI
For Private Circulation Only
3
Research Team Tel: 022 - 39357800
Website: www.angelbroking.com
For Technical Queries
E-mail: [email protected]
For Derivatives Queries
E-mail: [email protected]
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