Technical and Derivatives Review | August 10, 2018
Some consolidation on cards, but undertone remains bullish
Sensex (37869 ) / Nifty (11429)
Source: Trading View
Future outlook
Trading for the week kick-started with an upside gap as the set up on the domestic as well as global front was quite conducive for
our markets. During the remaining part, index consolidated by maintaining its positive posture. In fact, there was one attempt made
to clock fresh record highs at new milestone; but index came off a bit from the kissing distance of 11500 to conclude the week well
above the 11400 mark.
Generally, every rally has its own characteristics and we tend to see some different drivers. The only common factor that must
participate apart from other sectors is the ‘banking’. This time too banking index proved its significance; but within this basket, the
major contributors this time have been different. Some laggards like ICICI, Axis and SBI took the complete burden on their shoulders
and before anyone could realize, have managed to clock handsome gains over the past couple of weeks. When banking contributes
heavily, it not only acts like an impetus but also provides credence to the move. Hence, we still believe that further legs to this rally
are likely to unfold as we move forward. Yes, after seeing a relentless move, we may see some profit taking in between; but
eventually these pauses are likely to get bought into.
For the forthcoming week, if Nifty stays below the key support zone of 11379 - 11359 then we may see this profit booking getting
extended towards 11300 - 11235. But even if this happens, it would be a healthy sign with a broader view and hence, should be
construed as a buying opportunity. On the upside, the immediate resistance remains at 11500 - 11520. It’s a matter of time; we will
not be surprised to see this hurdle crossed to continue this northward journey. For the forthcoming week, first half would be quite
crucial and hence, one should keep a close eye on how markets behave around its key levels. The ideal strategy would be to have a
stock centric approach and follow proper exit strategy.
For Private Circulation Only
1
Technical and Derivatives Review | August 10, 2018
No meaningful change in data, avoid shorting
Nifty spot closed at 11429.50 this week, against a close of 11360.80 last week. The Put-Call Ratio has increased from 1.73 to 1.75
and the annualized Cost of Carry is positive at 1.56%. The Open Interest of Nifty Futures increased by 8.85%.
Derivatives View
Nifty current month future closed with a premium of 9.75 points against a premium of 34.95 points to its spot. Next month future is
trading with a premium of 41.15 points.
As far as Nifty options activities for the week are concerned, we saw fresh build-up in 11500 and 11600 call options. On the flip side,
fresh writing was seen in 11300 and 11400 put options. At current juncture, 11500 call and 11000 put options are attracting trader’s
attention.
Last week, we saw extension of the ongoing rally almost towards 11500 mark; but traders preferred booking profits on Friday to conclude
the week above 11400 mark. Meanwhile, good amount of longs were formed in Nifty as well as BankNifty Futures. Despite some profit
booking on Friday, we hardly saw any massive unwinding by put writers. At present, 11350-11400 is a strong base for Nifty; whereas,
10500-10550 is an important hurdle. Considering the above data points, we don’t see major correction from current levels, traders with
longs are advised to hold on their positions and any dips in the upcoming week shall be an opportunity to add fresh longs.
Long Formation
Short Formation
OI
OI
Price
OI
OI
Pric
Scrip
Price
Scrip
Price
Futures
Chg (%)
Chg (%)
Futures
Chg (%)
Chg (%
RCOM
124628000
13.37
19.55
24.52
UJJIVAN
6292800
22.87
353.90
(9.17)
PVR
1372800
8.50
1323.75
11.80
LUPIN
13150200
26.06
809.90
(8.73)
NCC
46888000
6.89
99.05
7.20
APOLLOTYRE
11145000
21.05
265.05
(7.63)
AXISBANK
47727600
12.85
615.65
6.87
ENGINERSIN
8613500
18.03
126.60
(7.35)
VOLTAS
6049000
25.34
616.50
6.72
CUMMINSIND
1131200
60.32
656.10
(7.20)
Weekly change in OI
For Private Circulation Only
2
Technical and Derivatives Review | August 10, 2018
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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