July 11, 2015
Technical Picks |
Markets stuck in a range
Sensex (27661) / Nifty (8361)
For the second consecutive week, we witnessed a gap down
Exhibit 1: Nifty Weekly chart
opening in the Nifty on Monday owing to developments related
to the Greece crisis last week end. However, once again, the
bulls showed tremendous resilience at lower levels; they not
only trimmed the day's losses but also managed to surpass the
psychological level of 8500 on the Nifty on a closing basis. A
quiet session on Tuesday was followed by yet another gap down
opening on the Nifty on Wednesday as turmoil in Chinese
markets spooked our domestic participants. Thus, the Nifty
corrected by nearly 200 points from the highs and eventually
Source: Falcon
concluded the week a tad above the 8350 mark. Barring
Exhibit 2: Nifty Daily chart
Healthcare, all other sectors traded with a negative bias
throughout the week; amongst which, the IT, Metal, Oil & gas
and Auto counters were the major losers. The Nifty pared down
all its previous week's gains by losing 1.47% over the previous
week's closing.
Pattern formation:
The '89-day EMA' and the '89-week EMA' are placed at
27670 / 8363 and 25607 / 7706 levels, respectively.
The '20-day EMA' and the '20-week EMA' are placed at
Source: Falcon
27661 / 8350 and 27697 / 8371 levels, respectively.
8195 on the Nifty in the near term. On the daily chart, the
'Higher Top Higher Bottom' is intact along with the positive
Future outlook
crossover of the weekly 'RSI-Smoothened' oscillator. Thus, the
During the week previous to the concluded week and even the
bulls have no reason to worry until the recent swing low of
early part of the concluded week, our markets showed
8195 is not broken. Only a sustainable move below this level
remarkable outperformance over global bourses. But on
may unfold the possibility of the Nifty retesting 8050 - 7940
Wednesday, the Nifty succumbed to global developments and
levels. However, on the upside, the immediate resistance is seen
took a knock after seeing a carnage in the Chinese (Shanghai
at 8400 levels on the Nifty. A sustainable move beyond this
Composite) and Hong Kong (Hang Seng) markets. In-line with
level may result in continuation of the 'Higher Top Higher Bottom'
our view, the Nifty surpassed its hurdle of 8500 on Monday,
to retest last week's high of 8561. The immediate support levels
but failed to continue with the momentum. Going forward,
for the coming week are seen at 8280 - 8195 on the Nifty.
further developments on the global as well as the domestic
Considering the ongoing uncertainty across the globe, it's
front will dictate the near term direction of our markets.
advisable to stay light on positions and follow strict stop losses.
Technically speaking, we are now stuck in a range of 8550 to
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July 11, 2015
Technical Picks |
Weekly Pivot Levels For Nifty 50 Stocks
SCRIPS
S2
S1
PIVOT
R1
R2
SENSEX
27,038
27,350
27,843
28,154
28,647
NIFTY
8,166
8,264
8,412
8,509
8,658
BANKNIFTY
18,123
18,422
18,701
18,999
19,279
ACC
1,425
1,448
1,482
1,506
1,539
AMBUJACEM
232
237
242
247
253
ASIANPAINT
724
760
797
833
870
AXISBANK
557
568
577
587
597
BAJAJ-AUTO
2,385
2,426
2,494
2,535
2,603
BANKBARODA
144
150
153
160
163
BHEL
241
255
263
276
284
BPCL
810
846
899
935
989
BHARTIARTL
401
410
427
436
452
BOSCH LIMITED
22,066
22,569
22,932
23,435
23,798
CAIRN
156
162
171
177
186
CIPLA
608
628
643
663
679
COALINDIA
404
412
421
429
438
DRREDDY
3,443
3,597
3,681
3,834
3,918
GAIL
338
349
370
381
401
GRASIM
3,419
3,508
3,558
3,646
3,696
HCLTECH
875
900
938
963
1,001
HDFCBANK
1,047
1,069
1,082
1,104
1,117
HDFC
1,235
1,259
1,303
1,328
1,372
HEROMOTOCO
2,453
2,512
2,576
2,635
2,698
HINDALCO
94
99
104
110
115
HINDUNILVR
859
880
912
932
965
ICICIBANK
299
306
312
319
325
IDEA
168
172
177
180
186
INDUSINDBK
856
875
894
913
932
INFY
896
917
953
974
1,011
ITC
299
305
312
317
325
KOTAKBANK
673
691
711
730
750
LT
1,732
1,804
1,842
1,914
1,952
LUPIN
1,740
1,805
1,866
1,931
1,992
M&M
1,188
1,219
1,276
1,307
1,365
MARUTI
3,851
3,893
3,949
3,991
4,047
NMDC
109
112
114
117
119
NTPC
122
126
132
136
143
ONGC
280
287
298
305
316
POWERGRID
133
136
139
142
145
PNB
136
140
144
148
151
RELIANCE
966
984
1,001
1,019
1,037
SBIN
256
263
269
276
282
SUNPHARMA
844
873
890
919
937
TCS
2,334
2,404
2,525
2,596
2,717
TATAMOTORS
369
386
411
427
452
TATAPOWER
68
70
73
74
77
TATASTEEL
263
272
288
296
312
TECHM
450
462
470
482
491
ULTRACEMCO
2,969
3,050
3,117
3,197
3,264
VEDANTA
121
134
151
163
180
WIPRO
532
541
551
560
570
YESBANK
741
775
827
861
912
ZEEL
339
350
361
372
384
Technical Research Team
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Derivatives Review |
Stay light. Immediate support is around 8260-8280 levels
Nifty spot closed at 8360.55 this week against a close of 8484.90 last week. The Put-Call Ratio has decreased from 1.11 to 1.05
levels and the annualized Cost of Carry is positive at 5.46%. The Open Interest of Nifty Futures increased by 7.00%.
Put-Call Ratio Analysis
Implied Volatility Analysis
PCR-OI has decreased from 1.11 to 1.05 levels mainly due to
Implied Volatility (IV) for NIFTY has increased from 14.92% to
open interest addition in call options. Huge buildup was visible
15.61%. Historical volatility (HV) of NIFTY is at 16.59% and
in 8400 call options last week which are long formation. Good
that for BANKNIFTY is trading at 22.00%. Liquid counters having
amount of build-up was also seen in 8600 & 8800 call options.
very high HV are VEDL, L&TFH, YESBANK, BPCL and OIL. Stocks
On the other hand in put options some build-up was visible in
where HV are on lower side are EICHERMOT, IBREALEST,
8300 strike followed by unwinding in 8000-8100 put options.
UNITECH, APOLLOHOSP and DISHTV.
Maximum buildup in current series is seen in 8400 call & 7900
put options.
Open Interest Analysis
Cost-of-Carry Analysis
Total open interest of market has increased from
Nifty current month futures closed at a premium of 25.00 points
`1,97,932/- cr. to `2,18,176/- cr. Stock futures open interest
against a premium of 3.10 points to its spot. Next month future
has increased from `57,793/- cr. to `61,060/- cr. Liquid
is trading with premium of 63.10 points. Liquid counters where
counters names which added significant positions last week
CoC is high are JINDALSTEL, KOTAKBANK, NTPC, HCLTECH
are VEDL, TCS, BPCL, TATASTEEL and ONGC. On the other
and ASIANPAINT. Stocks with negative CoC are TATASTEEL,
hand unwinding was visible in counters like HDFCBANK, CAIRN,
IDFC, TATAPOWER, TECHM and WIPRO.
AXISBANK, ZEEL and IDFC.
Derivative Strategy
Scrip : HINDUNILVR
CMP : `905.00
Lot Size : 250
Exercise Date (F & O) :
30th. July 2015
View: Mildly Bearish
Strategy: Long Put Ladder
Expected Payoff
Buy/Sell
Qty
Scrip
Strike
Series
Option
Buy/Sell Rate
Closing Price
Expected
Price
Type
(`)
(`)
Profit/Loss
BUY
250
HINDUNILVR
900
JULY
PE
17.00
830
(`12.00)
SELL
250
HINDUNILVR
880
JULY
PE
10.00
850
`8.00
SELL
250
HINDUNILVR
860
JULY
PE
5.00
870
`18.00
LBEP
-
`842/-
UBEP - `898/-
890
`8.00
Max. Risk: Unlimited
Max. Profit: `4,500/-
910
(`2.00)
If HINDUNILVR continues to move below LBEP.
If HINDUNILVR closes between 860 & 880 levels on expiry.
930
(`2.00)
NOTE: Profit can be booked before expiry if HINDUNILVR moves in favorable direction and time value decays.
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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)